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): October 29, 2020
CIM Real Estate Finance Trust, Inc.
(Exact Name of Registrant as Specified in its Charter)
| Maryland | 000-54939 | 27-3148022 | ||
|
(State or Other Jurisdiction of Incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
2398 East Camelback Road, 4th Floor, Phoenix, Arizona 85016
(Address of Principal Executive Offices) (Zip Code)
(602) 778-8700
(Registrant’s telephone number, including area code)
None
(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:
| ☒ |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ☐ |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
|
Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered |
||
| None | None | None |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 1.01 |
Entry into a Material Definitive Agreement |
As previously disclosed, on August 30, 2020, CIM Real Estate Finance Trust, Inc. (the “Company” or “CMFT”), Cole Credit Property Trust V, Inc. (“CCPT V”), and Thor V Merger Sub, LLC, a wholly owned subsidiary of the Company (“CCPT V Merger Sub”), entered into an Agreement and Plan of Merger (as subsequently amended on October 22, 2020 and October 24, 2020, the “CCPT V Merger Agreement”) with respect to the proposed merger of CCPT V Merger Sub (the “CCPT V Merger”) with and into CCPT V, with CCPT V Merger Sub surviving the CCPT V Merger.
On October 29, 2020, the parties to the CCPT V Merger Agreement entered into Amendment No. 3 to Agreement and Plan of Merger (the “Amendment”), pursuant to which the CCPT V Merger Agreement was amended to (i) increase the Exchange Ratio from 2.691 to 2.892 shares of CMFT Common Stock for each share of CCPT V Common Stock (as each term is defined in the CCPT V Merger Agreement) (with such ratio subject to adjustments in accordance with the terms and conditions of the CCPT V Merger Agreement), (ii) increase the amount of the Full Termination Payment (as defined in the CCPT V Merger Agreement) from $9,170,000 to $9,850,000 and (iii) increase the maximum amount of Expenses (as defined in the CCPT V Merger Agreement) payable by either CMFT or CCPT V to the other in connection with certain terminations of the CCPT V Merger Agreement from $1,670,000 to $1,790,000.
The foregoing description does not purport to be complete and is qualified in its entirety by reference to the Amendment, which is attached hereto as Exhibit 2.1 and is incorporated herein by reference.
| Item 1.02 |
Termination of a Material Definitive Agreement |
As previously disclosed, on August 30, 2020, the Company, Cole Office & Industrial REIT (CCIT II), Inc. (“CCIT II”), and Thor II Merger Sub, LLC, a wholly owned subsidiary of the Company (“CCIT II Merger Sub”), entered into an Agreement and Plan of Merger (as subsequently amended on October 22, 2020 and October 24, 2020, the “CCIT II Merger Agreement”) with respect to the proposed merger of CCIT II Merger Sub (the “CCIT II Merger”) with and into CCIT II, with CCIT II Merger Sub surviving the CCIT II Merger.
On October 29, 2020, CCIT II terminated the CCIT II Merger Agreement in accordance with Section 9.1(c)(ii) in order to enter into an Alternative Acquisition Proposal (as defined in the CCIT II Merger Agreement) and paid to CMFT $7,380,000 as the Go Shop Termination Fee (as defined in the CCIT Merger Agreement). CCIT II and the Company entered into an agreement (the “Termination Notice”) reflecting such matter and pursuant to which, among other things, (i) the Company waived the matching rights under the CCIT II Merger Agreement and (ii) CCIT II agreed to pay certain of the Company’s expenses, up to the expense cap set forth in the CCIT II Merger Agreement.
The foregoing description does not purport to be complete and is qualified in its entirety by reference to the Termination Notice, which is attached hereto as Exhibit 10.1 and is incorporated herein by reference.
| Item 8.01 |
Other Events. |
Distributions
On October 28, 2020, the Board of Directors (the “Board”) of the “Company authorized a distribution for the month of October 2020 of $0.0303 per share of the Company’s common stock. On August 30, 2020, the Board approved the suspension of the Company’s distribution reinvestment plan, and therefore, distributions for the month of October 2020 will be paid in cash to all stockholders. The distribution is payable to stockholders of record as of the close of business on October 29, 2020 and will be paid in cash on November 2, 2020.
ADDITIONAL INFORMATION ABOUT THE CCPT V MERGER
In connection with the proposed CCPT V Merger, CMFT intends to file a definitive registration statement on Form S-4 with the SEC that will include a proxy statement of CCPT V and will also constitute a prospectus of CMFT. This communication is not a substitute for such registration statement, the proxy statement/prospectus or any other documents that will be made available to the stockholders of CCPT V. In connection with the proposed CCPT V Merger, CCPT V intends to file relevant materials with the SEC, including a proxy statement on Schedule 14A relating to a special meeting of its stockholders. STOCKHOLDERS OF CCPT V ARE URGED TO READ ALL RELEVANT DOCUMENTS FILED WITH THE SEC, INCLUDING THE RELEVANT PROXY STATEMENT, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED CCPT V MERGER. Stockholders of CCPT V will be able to obtain such documents free of charge at the SEC’s website, www.sec.gov, or through CIM’s website at https://www.cimgroup.com/investment-strategies/individual/for-shareholders, as they become available. Such documents are not currently available.
PARTICIPANTS IN SOLICITATION RELATING TO THE CCPT V MERGER
CMFT and CCPT V and their respective directors and executive officers, as well as certain affiliates of CIM Group, LLC serving as their external advisors, may be deemed to be participants in the solicitation of proxies from CCPT V’s stockholders in respect of the proposed Merger between CMFT and CCPT V. Information regarding the directors, executive officers and external advisors of each of CMFT and CCPT V is contained in the Annual Report on Form 10-K for the year ended December 31, 2019 filed with the SEC by each entity on March 30, 2020, as amended on April 27, 2020. Investors may obtain additional information regarding the interest of such participants by reading the proxy statement of CCPT V regarding its proposed Merger with CMFT when it becomes available.
NO OFFER OR SOLICITATION
This communication does not constitute an offer to sell or the solicitation of an offer to buy or sell any securities or a solicitation of a proxy or of any vote or approval. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the U.S. Securities Act of 1933, as amended. This communication may be deemed to be solicitation material in respect of the proposed CCPT V Merger.
Forward-Looking Statements
This Current Report on Form 8-K includes certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Statements can generally be identified as forward-looking because they include words such as “believes,” “anticipates,” “expects,” “would,” “could,” or words of similar meaning. Statements that describe future plans and objectives are also forward-looking statements. These statements are based on the current expectations of management for CMFT and CCPT V and on currently available industry, financial and economic data. Actual results may vary materially from those expressed or implied by the forward-looking statements, which are subject to a number of risks and uncertainties, many of which are out of the control of such companies, including, but not limited to, those associated with the risk that the CCPT V Merger will not be consummated within the expected time period or at all; the occurrence of any event, change or other circumstance that could give rise to the termination of the CCPT V Merger Agreement; the failure to satisfy the conditions to the consummation of the CCPT V Merger, including the approval of the stockholders of CCPT V; and other factors, including those set forth in the section entitled “Risk Factors” in CMFT’s and CCPT V’s most recent Annual Reports on Form 10-K, as amended, and Quarterly Reports on Form 10-Q filed with the SEC, and other reports filed by CMFT and CCPT V with the SEC, copies of which are available on the SEC’s website, www.sec.gov. Forward-looking statements are not guarantees of performance or results and speak only as of the date such statements are made. Except as required by law, none of CMFT or CCPT V undertakes any obligation to update or revise any forward-looking statement in this communication, whether to reflect new information, future events, changes in assumptions or circumstances or otherwise.
| Item 9.01 |
Financial Statements and Exhibits. |
(d) Exhibits
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| CIM REAL ESTATE FINANCE TRUST, INC. | ||||||
| Date: November 2, 2020 | By: |
/s/ Nathan D. DeBacker |
||||
| Nathan D. DeBacker | ||||||
| Chief Financial Officer and Treasurer | ||||||
Exhibit 2.1
AMENDMENT NO. 3
TO
AGREEMENT AND PLAN OF MERGER
This Amendment No. 3 to Agreement and Plan of Merger (this “Amendment No. 3”), dated as of October 29, 2020, is entered into by and among CIM Real Estate Finance Trust, Inc., a Maryland corporation (“CMFT”), Thor V Merger Sub, LLC, a Maryland limited liability company and a wholly owned subsidiary of CMFT (“Merger Sub”), and Cole Credit Property Trust V, Inc., a Maryland corporation (“CCPT V”). Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Merger Agreement (as defined below).
W I T N E S S E T H:
WHEREAS, CMFT, CCPT V and Merger Sub are parties to the Agreement and Plan of Merger, dated as of August 30, 2020, as amended by the Amendment to Agreement and Plan of Merger, dated as of October 22, 2020, and the Amendment to Agreement and Plan of Merger, dated as of October 24, 2020 (the “Merger Agreement”).
WHEREAS, the Parties desire to (a) increase the Exchange Ratio from 2.691 to 2.892 shares of CMFT Common Stock for each share of CCPT V Common Stock, as such ratio may be adjusted in accordance with Section 3.1(b) of the Merger Agreement (b) increase the amount of the Full Termination Payment from $9,170,000 to $9,850,000 and (c) increase the amount of Expenses payable by either CMFT or CCPT V from $1,670,000 to $1,790,000;
WHEREAS, on the recommendation of the CCPT V Special Committee, the CCPT V Board has (a) determined that the Merger Agreement, as amended by this Amendment No. 3 and the transactions contemplated thereby, are advisable and in the best interest of, and are fair and reasonable to, CCPT V and on terms and conditions no less favorable to CCPT V than those available from unaffiliated third parties, (b) authorized and approved the execution and delivery of this Amendment No. 3 and the performance by CCPT V of its obligations under the Merger Agreement, as amended by this Amendment No. 3, (c) directed that the Merger contemplated by the Merger Agreement, as amended by this Amendment No. 3, and the other transactions contemplated thereby, be submitted for consideration at the Stockholders Meeting, and (d) recommended the approval of the Merger contemplated by the Merger Agreement, as amended by this Amendment No. 3, by the CCPT V stockholders;
WHEREAS, on the recommendation of the CMFT Special Committee, the CMFT Board has (a) determined that the Merger Agreement, as amended by this Amendment No. 3, and the transactions contemplated thereby, are advisable and in the best interest of CMFT, and (b) authorized and approved the execution and delivery of this Amendment No. 3 and the performance by CMFT of its obligations under the Merger Agreement, as amended by this Amendment No. 3;
WHEREAS, CMFT, in its capacity as the sole member of Merger Sub, has taken all actions required for the execution of this Amendment No. 3 by Merger Sub and to approve this Amendment No. 3 and the consummation by Merger Sub of the Merger contemplated by the Merger Agreement, as amended by this Amendment No. 3, and the other transactions contemplated thereby; and
WHEREAS, the Parties hereto desire to amend the Merger Agreement in accordance with Section 10.6 thereof and in the manner set forth herein.
NOW THEREFORE, in consideration of the premises and agreements herein contained, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Parties agree as follows:
1. Definition of Exchange Ratio. The definition of “Exchange Ratio” set forth in Section 1.1 of the Merger Agreement is hereby amended by replacing the reference to “2.691” therein with a reference to “2.892”.
2. Definition of Full Termination Payment. The definition of “Full Termination Payment” set forth in Section 1.1 of the Merger Agreement is hereby amended by replacing the reference to “$9,170,000” therein with a reference to “$9,850,000”.
3. Expenses and Fees. Section 9.3 of the Merger Agreement is hereby amended by (a) replacing each reference to “one million six hundred seventy thousand dollars” with a reference to “one million seven hundred ninety thousand dollars” and (b) replacing each reference to “$1,670,000” with a reference to “$1,790,000”.
4. Counterparts. This Amendment No. 3 may be executed in counterparts, each of which shall be deemed an original and all of which together shall be deemed one and the same agreement, and shall become effective when one or more counterparts have been signed by each of the Parties and delivered (electronically by email or facsimile) to the other Parties. Signatures to this Amendment No. 3 transmitted by facsimile transmission, by electronic mail in portable document form (pdf), or by any other electronic means intended to preserve the original graphic and pictorial appearance of a document, will have the same effect as physical delivery of the paper document bearing the original signature.
5. Entire Agreement. This Amendment No. 3, the Merger Agreement (including the Exhibit, Schedules, the CMFT Disclosure Letter and the CCPT V Disclosure Letter) and the Confidentiality Agreement (a) constitute the entire agreement and supersede all prior agreements and understandings, both written and oral, between the Parties with respect to the subject matter of this Amendment No. 3 and (b) except for the provisions of Section 7.7 (Indemnification; Directors’ and Officers’ Insurance) of the Merger Agreement (which, from and after the Merger Effective Time, shall be for the benefit of the Indemnified Parties), are not intended to confer upon any Person other than the Parties hereto any rights or remedies.
6. Miscellaneous. Except as specifically amended hereby, the Merger Agreement, as amended by this Amendment No. 3, shall remain in full force and effect. The terms and provisions of Section 10.2 (Notices), Section 10.3 (Severability), Section 10.6 (Amendment; Extension; Waiver), Section 10.7 (Governing Law; Venue), Section 10.8 (Assignment), Section 10.9 (Specific Performance), Section 10.10 (Waiver of Jury Trial) and Section 10.11 (Authorship) of the Merger Agreement are incorporated herein by reference as if set forth herein in their entirety and shall apply mutatis mutandis to this Amendment No. 3.
(Remainder of page intentionally left blank.)
-2-
IN WITNESS WHEREOF, the Parties have caused this Amendment No. 3 to be signed by their respective duly authorized officer, all as of the date first written above.
|
CIM REAL ESTATE FINANCE TRUST, INC. |
||
| By: | /S/ Nathan D. DeBacker | |
|
Name: |
Nathan D. DeBacker |
|
|
Title: |
Chief Financial Officer & Treasurer |
|
|
THOR V MERGER SUB, LLC |
||
| By: | /S/ Nathan D. DeBacker | |
|
Name: |
Nathan D. DeBacker |
|
|
Title: |
Vice President, Chief Financial Officer and Treasurer | |
(Signature Page to Amendment No. 3 to the Agreement and Plan of Merger)
|
COLE CREDIT PROPERTY TRUST V, INC. |
||
| By: | /S/ Avraham Shemesh | |
|
Name: |
Avraham Shemesh |
|
|
Title: |
President and Chief Executive Officer |
|
(Signature Page to Amendment No. 3 to the Agreement and Plan of Merger)
Exhibit 10.1
Cole Office & Industrial REIT (CCIT II), Inc.
2325 East Camelback Road, Suite 1100
Phoenix, Arizona 85016
October 29, 2020
VIA ELECTRONIC MAIL
Special Committee of the Board of Directors
c/o CIM Real Estate Finance Trust, Inc.
2398 East Camelback Road, 4th Floor
Phoenix, Arizona 85016
Attn: T. Patrick Duncan
Email: tpdunc@icloud.com
with copies to:
Sullivan & Cromwell LLP
1888 Century Park East, 21st Floor
Los Angeles, CA 90067
Attn: Patrick S. Brown
E-mail: brownp@sullcrom.com
Venable LLP
750 East Pratt Street
Baltimore, Maryland 21202
Attn: Sharon A. Kroupa
E-Mail: skroupa@venable.com
Re: Termination
Ladies and Gentlemen:
Reference is hereby made to that certain Agreement and Plan of Merger, dated as of August 30, 2020, by and among CIM Real Estate Finance Trust, Inc. (“CMFT”), Thor II Merger Sub, LLC and Cole Office & Industrial REIT (CCIT II), Inc. (“CCIT II”) (the “Merger Agreement”). Capitalized terms used herein and not otherwise defined shall have the meanings set forth in the Merger Agreement.
Per the letter delivered to you on October 7, 2020, CCIT II received an Acquisition Proposal from Griffin Capital Essential Asset REIT, Inc. (“GCEAR”, and such Acquisition Proposal, the “GCEAR Acquisition Proposal”) prior to the Go Shop Period End Time. As set forth in the CCIT II Change Notice delivered to you on October 26, 2020, after extensive analyses and discussions with its financial advisors and legal counsel, the CCIT II Special Committee determined that the GCEAR Acquisition Proposal constituted a Superior Proposal and that failure to terminate the Merger Agreement pursuant to Section 9.1(c)(ii) of the Merger Agreement to enter into an Alternative Acquisition Agreement with GCEAR for such Superior Proposal would be inconsistent with CCIT II’s directors’ duties or standard of conduct under Maryland Law.
Following delivery of the CCIT II Change Notice, CMFT notified CCIT II that it intended to waive its negotiation and other rights under Sections 7.3(f)(i) and (ii) of the Merger Agreement, including CCIT II’s obligation to negotiate with CMFT during the four (4) Business Day period following delivery of the CCIT Change Notice.
Consequently, and conditional on CMFT’s agreement to the Termination Conditions (as defined below), the CCIT II Special Committee has recommended to the CCIT II Board that it terminate the Merger Agreement pursuant to this letter agreement in order to enter into the Alternative Acquisition Agreement with GCEAR, which the CCIT II Board has subsequently approved.
By countersigning this letter, CMFT hereby agrees that (a) CCIT II’s obligations pursuant to Sections 7.3(f)(i) and (ii) of the Merger Agreement are hereby waived, (b) CCIT II is deemed to have satisfied the requirements of the proviso immediately preceding Section 7.3(f)(i) of the Merger Agreement, (c) receipt of the Go Shop Termination Payment from CCIT II and receipt of CCIT II’s subsequent payment to CMFT of CMFT’s Expenses, not to exceed $3,690,000 in the aggregate, the obligation of which to pay CCIT II hereby affirms, shall constitute liquidated damages in accordance with and as set forth in Section 9.3(d) of the Merger Agreement and (d) CCIT II’s obligation to pay CMFT’s Expenses, not to exceed $3,690,000 in the aggregate, pursuant to Section 9.3(b)(ii) and Section 9.3(c)(ii) of the Merger Agreement prior to or concurrently with the termination of the Merger Agreement is hereby waived, provided that CCIT II shall pay CMFT’s Expenses, not to exceed $3,690,000 in the aggregate, within three (3) Business Days following receipt by CCIT II of CMFT’s invoice in respect of such Expenses (clauses (a), (b), (c) and (d), collectively, the “Termination Conditions”).
Subject to and immediately upon CMFT’s agreement to the Termination Conditions by delivering to CCIT II its countersignature to this letter, CCIT II hereby terminates the Merger Agreement pursuant to Sections 9.1(c)(ii) and 9.2 thereof, effective as of the date hereof.
CMFT hereby consents to the amendment of the CCIT II Special Committee’s engagement letter with Truist Securities to provide for an additional fairness opinion fee (the “Consent”).
Please sign and return a copy of this letter as acknowledgement of CMFT’s Agreement to the Termination Conditions and the Consent.
[Signature Page Follows]
| Sincerely, | ||
| COLE OFFICE & INDUSTRIAL REIT (CCIT II), INC. | ||
| By: |
/S/ Richard Dozer |
|
| Name: | Richard Dozer | |
| Title: | Chairman of CCIT II Special Committee | |
[Signature Page to Termination Notice]
| Acknowledged and Agreed to as of the date first written above: | ||
| CIM REAL ESTATE FINANCE TRUST, INC. | ||
| By: |
/S/ Nathan D. DeBacker |
|
| Name: | Nathan D. DeBacker | |
| Title: | Chief Financial Officer & Treasurer | |
[Signature Page to Termination Notice]