Blog: STORE CAPITAL CORP : Entry into a Material Definitive Agreement, Regulation FD Disclosure, Financial Statements and Exhibits (form 8-K) – Marketscreener.com

Item 1.01 Entry into a Material Definitive Agreement.

On September 15, 2022, STORE Capital Corporation, a Maryland corporation (the
“Company”), Ivory Parent, LLC, a Delaware limited liability company (“Parent”),
Ivory REIT, LLC, a Delaware limited liability company and a wholly-owned
subsidiary of Parent (“Merger Sub” and, together with Parent, the “Parent
Parties”), entered into an Agreement and Plan of Merger (the “Merger
Agreement”). The Merger Agreement provides that, upon the terms and subject to
the conditions set forth therein, the Company will merge with and into Merger
Sub (the “Merger”). Upon completion of the Merger, Merger Sub will survive and
the separate existence of the Company will cease. The Merger and the other
transactions contemplated by the Merger Agreement were unanimously approved and
declared advisable by the board of directors of the Company (the “Company
Board”). The Parent Parties are affiliates of GIC, a global institutional
investor, and Oak Street Real Estate Capital, a division of Blue Owl Capital,
Inc. (collectively, the “Sponsors”).

Merger Consideration

Pursuant to the terms and subject to the conditions set forth in the Merger
Agreement, at the effective time of the Merger (the “Merger Effective Time”),
each share of common stock, $0.01 par value per share, of the Company (“Company
Common Stock”) that is issued and outstanding immediately prior to the Merger
Effective Time will be automatically cancelled and converted into the right to
receive an amount in cash equal to $32.25 (the “Merger Consideration”), without
interest.

Notwithstanding the foregoing, each share of Company Common Stock then held by
the Company, the Parent Parties or any of their respective wholly-owned
subsidiaries, if any, will be canceled and retired and will cease to exist, and
no consideration will be paid, nor will any right inure or be made with respect
to such shares of Company Common Stock in connection with or as a consequence of
the Merger.

Company Compensatory Awards

Pursuant to the terms and subject to the conditions set forth in the Merger
Agreement, immediately prior to the Merger Effective Time, each outstanding
award of restricted shares of Company Common Stock will automatically become
fully vested and all restrictions and repurchase rights thereon will lapse, and
thereafter all shares of Company Common Stock represented thereby will be
considered outstanding for all purposes of the Merger Agreement and subject to
the right to receive an amount in cash equal to the Merger Consideration, less
any applicable withholding taxes.

In addition, pursuant to the terms and conditions in the Merger Agreement,
immediately prior to the Merger Effective Time, outstanding awards of restricted
share units with respect to shares of Company Common Stock (“Company Performance
Units”) will automatically become earned and vested in accordance with the
actual level of performance of the Company as of the date of execution of the
Merger Agreement and thereafter will be cancelled in exchange for the right to
receive an amount in cash equal to the product of (a) the Merger Consideration
and (b) the number of so-determined earned shares subject to such vested Company
Performance Units, without interest and less any applicable withholding taxes.
Upon the consummation of the Merger, the Company will also pay holders of
Company Performance Units an amount equal to all accrued and unpaid cash
dividends that would have been paid on the number of so-determined earned shares
subject to such vested Company Performance Units as if they had been issued and
outstanding from the date of grant up to, and including, the Merger Effective
Time, less any applicable withholding taxes.

Closing Conditions

The consummation of the Merger is subject to certain closing conditions,
including, among others, the approval of the Merger by the affirmative vote of
the holders of at least a majority of the outstanding shares of Company Common
Stock entitled to vote on the Merger (the “Stockholder Approval”), and the
clearance by the Committee on Foreign Investment in the United States. The
obligations of the parties to consummate the Merger are not subject to any
financing condition or the receipt of any financing by the Parent Parties. The
Merger Agreement provides that, unless Parent otherwise agrees in writing, the
consummation of the Merger will not occur prior to February 1, 2023.

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Representations, Warranties and Covenants

The Merger Agreement contains customary representations, warranties and
covenants, including, among others, covenants by the Company to conduct its
business in the ordinary course consistent with past practice in all material
respects, subject to certain exceptions, during the period between the execution
of the Merger Agreement and the consummation of the Merger. The Merger Agreement
also requires the Company to convene and hold a stockholders’ meeting for the
purpose of obtaining the Stockholder Approval.

“Go-Shop” Period and Subsequent Prohibition on Solicitations of Transactions

Until 11:59 p.m. (Eastern time) on October 15, 2022 (the “No-Shop Period Start
Date”), the Company will have the right to solicit, initiate, encourage or
facilitate any inquiry, indication of interest, request for information or
discussion that constitutes, or could reasonably be expected to lead to, an
alternative acquisition proposal, including by providing non-public information
and data regarding the Company to any person pursuant to an acceptable
confidentiality agreement, and engage in any discussions or negotiations with
any persons with respect to an alternative acquisition proposal or potential
alternative acquisition proposal. Within one business day after the No-Shop
Period Start Date, the Company will notify Parent in writing of the identity of
each person, if any, from whom the Company received an alternative acquisition
proposal after the date of execution of the Merger Agreement and prior to the
No-Shop Period Start Date, including any “Excluded Party” (as defined in the
Merger Agreement), and provide (i) an unredacted copy of any such alternative
acquisition proposal made in writing and any other written terms or proposals
and (ii) a written summary of the material terms and conditions of any
alternative acquisition proposal not made in writing. The Company may continue
to engage in the activities described above with respect to an Excluded Party
until the Cut-Off Time (as defined below).

From and after the No-Shop Period Start Date, other than as permitted with
respect to an Excluded Party as described above, the Company has agreed to cease
any solicitations, discussions, negotiations or communications with any person
with respect to any alternative acquisition proposal and not to solicit,
initiate, knowingly encourage or knowingly facilitate the submission or
announcement of any alternative acquisition proposal or any inquiry, indication
of interest, request for information or discussion that constitutes, or could
reasonably be expected to lead to, an alternative acquisition proposal, and,
subject to certain exceptions, is not permitted to, among other things, engage
in or otherwise participate in any discussions or negotiations concerning, or
provide any non-public information to any third party in connection with, any
alternative acquisition proposal. However, the Company may, prior to obtaining
the Stockholder Approval, engage in discussions or negotiations and
provide non-public information to a third party which has made an unsolicited
bona fide written acquisition proposal if the Company Board determines in good
faith, after consultation with its independent financial advisors and outside
legal counsel, that such proposal constitutes, or could reasonably be expected
to lead to, a “Superior Proposal” (as defined in the Merger Agreement).

Prior to obtaining the Stockholder Approval, the Company Board may, in certain
circumstances, effect a Change in Recommendation, subject to complying with
specified notice and other conditions set forth in the Merger Agreement.

Termination of the Merger Agreement; Two-Tier Termination Fee

The Merger Agreement contains customary termination rights, including the right
of either party to terminate the Merger Agreement if the Merger has not been
completed by 11:59 p.m. (Eastern time) on March 31, 2023 or the Stockholder
Approval has not been obtained upon a vote taken at the stockholders’ meeting or
any adjournment or postponement thereof. The Merger Agreement also may be
terminated by the Company under certain circumstances, including if, prior to
obtaining the Stockholder Approval and after following certain procedures and
adhering to certain restrictions, the Company Board effects a Change in
Recommendation in connection with a Superior Proposal and the Company enters
into a definitive agreement providing for the implementation of such Superior
Proposal. In addition, Parent may terminate the Merger Agreement under certain
circumstances and subject to certain restrictions, including if, prior to
obtaining the Stockholder Approval, the Company Board effects a Change in
Recommendation.

The Company will be required to pay a termination fee to Parent equal to $137.0
million if the Merger Agreement is terminated by the Company prior to 11:59 p.m.
(Eastern time) on October 20, 2022 (subject to extension in certain
circumstances) (the “Cut-Off Time”) to enter into a definitive agreement with an
Excluded Party providing

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for the implementation of a Superior Proposal. The Company will be required to
. . .

Item 7.01 Regulation FD Disclosure.

On September 15, 2022, the Company issued a press release announcing the
execution of the Merger Agreement. The full text of the press release is
attached hereto as Exhibit 99.1 and is incorporated herein by reference.

On September 15, 2022, after the announcement of the Merger, the Company
provided supplemental information regarding the proposed Merger in
communications circulated to its employees and customers. Copies of the employee
and customer communications are attached hereto as Exhibits 99.2 and 99.3,
respectively, and incorporated herein by reference.

The information contained in Item 7.01 of this report, including the information
in Exhibits 99.1, 99.2 and 99.3 attached to this report, is furnished pursuant
to Item 7.01 of Form 8-K and shall not be deemed “filed” for the purposes of
Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise
subject to the liabilities of that section. Furthermore, the information in Item
7.01 of this report, including the information in Exhibits 99.1, 99.2 and 99.3
attached to this report, shall not be deemed to be incorporated by reference in
the filings of the registrant under the Securities Act of 1933, as amended.

Additional Information and Where to Find It

This Current Report on Form 8-K relates to the proposed merger involving the
Company. In connection with the proposed transaction, the Company will file with
the SEC a proxy statement on Schedule 14A. Promptly after filing its definitive
proxy statement with the SEC, the Company will mail the definitive proxy
statement and a proxy card to each stockholder entitled to vote at the special
meeting relating to the proposed transaction. INVESTORS AND SECURITY HOLDERS OF
THE COMPANY ARE URGED TO READ THE PROXY STATEMENT (INCLUDING ANY AMENDMENTS OR
SUPPLEMENTS THERETO) AND ANY OTHER RELEVANT DOCUMENTS IN CONNECTION WITH THE
TRANSACTION THAT THE COMPANY FILES WITH THE SEC WHEN THEY BECOME AVAILABLE
BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION.
The definitive proxy statement, the preliminary proxy statement and any other
documents filed by the Company with the SEC (when available) may be obtained
free of charge at the SEC’s website at http://www.sec.gov or by accessing the Investor
Relations section of the Company’s website at https://ir.storecapital.com or by
contacting the Company’s Investor Relations by email at info@storecapital.com.

Participants in the Solicitation

The Company and its directors and certain of its executive officers may be
deemed to be participants in the solicitation of proxies from the Company’s
stockholders with respect to the proposed transaction. Information about the
Company’s directors and executive officers and their ownership of the Company’s
securities is set forth in the Company’s proxy statement on Schedule 14A for its
2022 annual meeting of stockholders, filed with the SEC on April 14, 2022, and
subsequent documents filed with the SEC.

Additional information regarding the identity of participants in the
solicitation of proxies, and a description of their direct or indirect interests
in the proposed transaction, by security holdings or otherwise, will be set
forth in the proxy statement and other materials to be filed with the SEC in
connection with the proposed transaction when they become available.

Cautionary Statement Regarding Forward Looking Statements

Some of the statements contained in this Current Report on Form 8-K constitute
forward-looking statements within the meaning of the federal securities laws.
Forward-looking statements relate to expectations, beliefs, projections, future
plans and strategies, anticipated events or trends and similar expressions
concerning matters that

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are not historical facts. In some cases, you can identify forward-looking
statements by the use of forward-looking terminology such as “may,” “will,”
“should,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,”
“predicts,” or “potential” or the negative of these words and phrases or similar
words or phrases which are predictions of or indicate future events or trends
and which do not relate solely to historical matters. You can also identify
forward-looking statements by discussions of strategy, plans or intentions.

The forward-looking statements contained in this Current Report on
Form 8-K reflect the Company’s current views about future events and are subject
to numerous known and unknown risks, uncertainties, assumptions and changes in
circumstances, many of which are beyond the control of the Company, that may
cause actual results and future events to differ significantly from those
expressed in any forward-looking statement, which risks and uncertainties
include, but are not limited to: the ability to complete the proposed
transaction on the proposed terms or on the anticipated timeline, or at all,
including risks and uncertainties related to securing the necessary stockholder
approval and satisfaction of other closing conditions to consummate the proposed
transaction; the occurrence of any event, change or other circumstance that
could give rise to the termination of the Merger Agreement relating to the
proposed transaction; risks that the proposed transaction disrupts the Company’s
current plans and operations or diverts the attention of the Company’s
management or employees from ongoing business operations; the risk of potential
difficulties with the Company’s ability to retain and hire key personnel and
maintain relationships with customers and other third parties as a result of the
proposed transaction; the failure to realize the expected benefits of the
proposed transaction; the risk that the proposed transaction may involve
unexpected costs and/or unknown or inestimable liabilities; the risk that the
Company’s business may suffer as a result of uncertainty surrounding the
proposed transaction; the risk that stockholder litigation in connection with
the proposed transaction may affect the timing or occurrence of the proposed
transaction or result in significant costs of defense, indemnification and
liability; effects relating to the announcement of the transaction or any
further announcements or the consummation of the transaction on the market price
of the Company’s common stock.

While forward-looking statements reflect the Company’s good faith beliefs, they
are not guarantees of future performance or events. Any forward-looking
statement speaks only as of the date on which it was made. The Company disclaims
any obligation to publicly update or revise any forward-looking statement to
reflect changes in underlying assumptions or factors, of new information, data
or methods, future events or other changes. For a further discussion of these
and other factors that could cause the Company’s future results to differ
materially from any forward-looking statements, see the section entitled “Risk
Factors” in the Company’s Annual Report on Form 10-K for the year ended
December 31, 2021, filed with the SEC on February 25, 2022, as updated by the
Company’s subsequent periodic reports filed with the SEC.

Item 9.01 Financial Statements and Exhibits.




(d) Exhibits



Exhibit                                  Description

 2.1          Agreement and Plan of Merger, dated as of September 15, 2022, by and
            among Ivory Parent, LLC, Ivory REIT, LLC and STORE Capital
            Corporation.

99.1          Press Release, issued September 15, 2022.

99.2          Communication to Employees.

99.3          Communication to Customers.

104         Cover Page Interactive Data File (embedded within the Inline XBRL
            document).

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