Item 1.01. Entry into a Material Definitive Agreement.
Merger Agreement
On
Through its acquisition of LAACO, the Company will acquire, for an aggregate
gross purchase price, payable in cash, of approximately
In addition to the Storage West Platform, the Company expects to acquire LAACO's
wholly owned subsidiaries, the
The Merger Agreement and the transactions contemplated by the Merger Agreement are subject to the approval of a majority of the holders of the outstanding units of LAACO entitled to vote on such transaction according to applicable law and the limited partnership agreement of LAACO (the "Unitholder Approval"). Concurrently with the execution of the Merger Agreement, the Company and Stability will enter into a voting agreement (the "Voting Agreement"), pursuant to which Stability will agree to vote all its outstanding units in LAACO, which constitute a majority of the outstanding units of LAACO, in favor of entering into the Merger Agreement and consummating the Merger. The vote of Stability's units pursuant to the Voting Agreement will be sufficient to obtain the Unitholder Approval and no other vote by a limited partner of LAACO will be necessary to obtain the Unitholder Approval.
The Company expects to finance the purchase price at closing through a combination of (i) the net proceeds from the issuance and sale of the Company's equity securities on or prior to the closing date and (ii) the proceeds from new long-term debt financing, such as a long term loan or debt securities, which the Company intends to pursue prior to the closing of the acquisition. If such debt financing is unavailable, the Company intends to finance any remaining portion of the acquisition purchase price with proceeds from a senior unsecured bridge loan facility and/or unsecured revolving credit facility.
To ensure that the Company has sufficient funds to finance the Purchase Price at
Closing in the event that the contemplated financing sources are insufficient,
the Company has received a commitment to provide a senior unsecured bridge loan
facility in an original principal amount of
Effects of the Merger
At the Closing, and subject to the terms and conditions of the Merger Agreement, each outstanding limited partnership unit and general partnership unit of LAACO (other than units held by LAACO in treasury or by the Company or Merger Sub, which are referred to herein as "Cancelled Units") will automatically be cancelled and converted into the right to receive their pro rata share of the Purchase Price (net of amounts applied to repay LAACO debt). At the Closing, all Cancelled Units will automatically be cancelled and will cease to exist and no consideration will be delivered in exchange for such Cancelled Units.
Representations, Warranties, and Covenants
Each of the Company and LAACO has made customary representations and warranties in the Merger Agreement and has agreed to customary covenants regarding the operation of the business of LAACO and its Subsidiaries prior to the Effective Time. The parties have also agreed to use their reasonable best efforts to consummate the Merger.
Closing Conditions
Consummation of the Merger is expected to occur in the fourth quarter of 2021 and is subject to customary closing conditions, including, without limitation, the accuracy of the representations and warranties (subject to customary materiality qualifiers), the absence of any Material Adverse Effect with respect to LAACO and compliance with the covenants and agreements contained in the Merger Agreement (subject to customary materiality qualifiers). The Merger is not subject to any financing condition.
Termination
The Merger Agreement may be terminated prior to the Closing upon the occurrence or non-occurrence of certain events, including the following:
· by either party if the Closing has not occurred on or before
· by either party if any Order by a Governmental Entity restraining or enjoining
the Merger becomes final and non-appealable or if any Law has been enacted applicable to the Merger that prohibits or enjoins consummation of the Merger; and
· by the Company or LAACO, if the other party breaches any of its representations
and warranties in the Merger Agreement (subject to customary materiality qualifiers) and such breach is not curable or is not cured within 15 business days of such party's receipt of notice of such breach.
The foregoing description of the Merger Agreement is not complete and is
qualified in its entirety by reference to the Merger Agreement, which is
attached as Exhibit 2.1 to this report and incorporated herein by reference. The
representations, warranties and covenants of the parties contained in the Merger
Agreement have been made solely for the benefit of the parties thereto (subject
to certain customary exceptions). In addition, such representations, warranties
and covenants (i) have been made only for purposes of the Merger Agreement,
(ii) have been qualified by confidential disclosures made by LAACO to the
Company in connection with the Merger Agreement, (iii) are subject to
materiality qualifications contained in the Merger Agreement which may differ
from what may be viewed as material by investors, (iv) were made only as of the
date of the Merger Agreement or such other date as is specified in the Merger
Agreement and (v) have been included in the Merger Agreement for the purpose of
allocating risk between the contracting parties rather than establishing matters
as facts. Accordingly, the Merger Agreement is included with this report only to
provide investors with information regarding the terms of the Merger Agreement,
and not to provide investors with any other factual information regarding the
parties or their respective businesses. Investors should not rely on the
representations, warranties or covenants, or any descriptions thereof, as
characterizations of the actual state of facts or condition of the parties or
any of their respective subsidiaries or affiliates. Moreover, information
concerning the subject matter of the representations and warranties may change
after the date of the Merger Agreement, which subsequent information may or may
not be fully reflected in the Company's public disclosures. Accordingly, you
should read the representations and warranties in the Merger Agreement not in
isolation but only in conjunction with the other information about the Company
and LAACO that is or will be included in reports, statements and other filings
that the Company will file with the
Item 7.01. Regulation FD Disclosure.
On
The Company and CubeSmart have prepared an investor presentation with respect to the merger transaction. A copy of the investor presentation can be found on CubeSmart's investor relations website at investors.cubesmart.com.
The press release and investor presentation shall not be deemed "filed" for any purpose, including for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the liabilities of that Section. The information in this Item 7.01, including Exhibit 99.1 shall not be deemed incorporated by reference into any filing of the Company or CubeSmart under the Securities Act, or the Exchange Act regardless of any general incorporation language in the filing.
Forward-Looking Statements
This Current Report on Form 8-K contains certain "forward-looking" statements as
that term is defined by Section 27A of the Securities Act and Section 21E of the
Exchange Act that are based on management's current expectations, assumptions
and beliefs. Forward-looking statements can often be identified by words such as
"expect," "intend" and similar expressions, and variations or negatives of these
words. These forward-looking statements include, but are not limited to,
statements regarding the expected closing of the Merger, if at all.
Forward-looking statements are not guarantees of future results and are subject
to risks, uncertainties and assumptions that could cause actual results to
differ materially from those expressed in any forward-looking statement, which
risks, uncertainties and assumptions include, but are not limited to, the
ability of the parties to consummate the proposed transaction? satisfaction of
closing conditions to the consummation of the proposed transaction? and
CubeSmart's ability to realize anticipated benefits of the proposed transaction.
Readers should not place undue reliance on any forward-looking statements and
are encouraged to review the Company's Annual Report on Form 10-K for the year
ended
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits. Exhibit No. Description of Exhibit 2.1 Agreement and Plan of Merger, by and among LAACO, Ltd.,CubeSmart, L.P., CS West Merger Sub, L.P. andStability LLC , dated as ofNovember 15, 2021 * 99.1 CubeSmart Press Release, datedNovember 15, 2021 104 Cover Page Interactive Data File - the cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document * Schedules and other similar attachments have been omitted pursuant to Item 601(b)(2) of Regulation S-K, which include the Company Disclosure Schedules (as defined in the Merger Agreement). The signatory hereby undertakes to furnish supplementally copies of any of the omitted schedules and attachments upon request by theSEC .
© Edgar Online, source