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COMSTOCK HOLDING COMPANIES, INC. FILES (8-K) Disclosing Entry into a Material Definitive Agreement, Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant

July 28, 2014



Item 1.01 Entry into a Material Definitive Agreement

The disclosure set forth in Item 2.03 is hereby incorporated into this item by reference.

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an

Off-Balance Sheet Arrangement of a Registrant

On July 23, 2014, Comstock Holding Companies, Inc. (the "Company"), through its subsidiary Comstock Yorkshire, L.C. (the "Borrower"), entered into a loan agreement ("Loan Agreement") and related documents with Cardinal Bank, lender, pursuant to which the Borrower secured a Six Million Seventy Thousand Dollar ($6,070,000) development and construction loan (the "Loan") to finance the Borrower's development of its Falls Grove single family home project in Manassas, Virginia (the "Project"). Under the terms of the Loan Agreement, the Loan provides for an initial variable interest rate of Prime plus one-half percent with an interest rate floor of four and one-half percent (4.5%). The Loan has a maturity date of twenty-four (24) months from the date of the closing of the Loan so long as the Borrower, among other things, sells and settles at least three (3) units within the nine (9) month period following the closing of the Loan. There is no prepayment penalty associated with the Loan, which is secured by a first deed of trust on the Project. The Loan is fully guaranteed by the Company, with a limited guaranty by Christopher Clemente, the CEO of the Company. Mr. Clemente has initially agreed not to charge a credit enhancement fee for the Loan as authorized by the Credit Enhancement Agreement previously entered into by and between the Company and Mr. Clemente. The foregoing summary of the Loan Agreement is qualified in its entirety by the provisions of the Loan Agreement, which the Company intends to file with its Quarterly Report on Form 10-Q for the fiscal quarter ending September 30, 2014.

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Source: Edgar Glimpses


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