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 25, 2011
BROWNIE’S MARINE GROUP,
INC.
(Exact
name of registrant as specified in its charter)
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Nevada
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000-28321
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90-0226181
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of
Incorporation)
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(Commission
File
Number)
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(I.R.S.
Employer
Identification
No.)
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940 N.W. 1st Street, Fort Lauderdale, Florida
33311
(Address
of Principal Executive Office) (Zip Code)
(954) 462-5570
(Registrant’s
telephone number, including area code)
(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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¨
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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
240.14a-12)
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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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Triggering
Events That Accelerate or Increase a Direct Financial Obligation or an
Obligation Under an Off-Balance Sheet
Arrangement
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On
January 25, 2011, Trebor Industries, Inc. (“Trebor”), a wholly owned subsidiary
of Brownie’s Marine Group, Inc. (the "Company") received from its primary
lender, Branch Banking and Trust Company ("BB&T"), a copy of an action filed
in the Circuit Court of the 17th
Judicial Circuit in and for Broward County Florida (the “Complaint”) of
BB&T's action to enforce a mortgage and a promissory with a balance of
$885,000.00 (the “Term Loan”) and a second mortgage and promissory note with a
balance of $199,990.98 (the “Second Note”). The Term Loan and Second Note are
collectively referred to as the “Secured Notes”.
As
previously disclosed under the Company’s Form 10-Q for the period ended
September 30, 2010, Trebor converted its revolving line of credit that matured
on December 2, 2009 into the Term Loan that matures on February 12, 2011. As
part of the conversion, Trebor granted BB&T a second mortgage on the
underlying security (the “Security”), which includes a mortgage on the Company’s
executive offices and manufacturing facilities located in Fort Lauderdale,
Florida and Trebor’s assets and inventory. The Company’s chief
executive officer also executed a personal guaranty of all amounts due under the
Secured Notes.
On
September 15, 2010, Trebor received a default letter from BB&T demanding
Secured Notes, be brought current by October 15, 2010. Under the terms of the
default notice, if the Company failed to bring the loans current by October 15,
2010, the Bank would accelerate as due the full principal and accrued interest
due under the Secured Notes, as well as initiate collection and legal action and
seek foreclosure on the Security. As of December 31, 2010, the Company was
approximately 5 months in arrears on payments to BB&T.
Under the
Complaint, BB&T has demanded a judgment in its favor of approximately
$1,083,965, as of January 10, 2011, which reflects the outstanding balance on
the Secured Notes, together with additional interest and court and attorney
fees. The Company intends to respond to the Complaint and defend the action
commenced by BB&T. In addition, the Company will also explore a possible
settlement or forbearance agreement with BB&T. There can be no assurance
that the Company will be able to negotiate a settlement or forbearance agreement
with BB&T. Any judgment in favor of BB&T would have a
material adverse impact on the Company’s continuing business and
operations.
SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the Company has duly
caused this report to be signed on its behalf by the undersigned, hereunto duly
authorized.
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BROWNIE’S
MARINE GROUP, INC.
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Date: January
28, 2011
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/s/ Robert Carmichael
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Robert
Carmichael
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Chief
Executive Officer
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