CIM Commercial Trust Corporation (NASDAQ: CMCT and TASE: CMCT-L)
(“we”, “our”, “CMCT”, “CIM Commercial”, or the “Company”), a real
estate investment trust (“REIT”) that primarily acquires, owns, and
operates Class A and creative office assets in vibrant and
improving metropolitan communities throughout the United States
(including improving and developing such assets), announced today
that it intends to conduct a rights offering for an aggregate of
approximately $137.3 million of newly issued shares of common
stock, par value $0.001 per share, of the Company (“Common Stock”).
A record date of 4:00 p.m., New York Time, on June 11, 2021 has
been set for the planned rights offering.
“This offering will provide CMCT growth capital and improved
financial flexibility, scale, and float, while giving shareholders
the option to maintain their ownership percentage in CMCT,” said
David Thompson, Chief Executive Officer of CIM Commercial.
“CMCT was one of the most active U.S. listed REITs in selling
stabilized assets from 2016 to 2019. We have retained a
high-quality portfolio in attractive markets with significant
growth potential. While the pandemic delayed our efforts to
significantly increase the cash flow and value of our portfolio, we
remain confident in these internal growth opportunities. In
addition, we are seeing numerous potential attractive acquisition
opportunities.”
“We believe utilizing CIM Group’s large-scale real estate
platform to source and execute on these potential acquisitions and
to execute on our significant same store growth opportunities will
maximize shareholder value over the short, medium and long
term.”
Upon commencement of the planned rights offering, the Company
will distribute to holders of record as of the record date one
non-transferable subscription right for each share of Common Stock
held by such holder as of the record date. Each subscription right
will entitle its holder to purchase one share of Common Stock at a
subscription price of $9.25 per share. Holders of subscription
rights that exercise in full such basic subscription rights will be
entitled, subject to certain limitations and conditions, to
over-subscribe for additional shares of Common Stock that remain
unsubscribed for in the rights offering as a result of any
unexercised basic subscription rights. If the offering is
over-subscribed, then any exercise of the over-subscription
privilege will be subject to proration as described in the
prospectus supplement in respect of the rights offering. The
exercise of the subscription rights will also be subject to any
applicable stock ownership limitations set forth in the charter of
the Company and as further described in the prospectus supplement.
The rights offering is expected to expire at 4:00 p.m., New York
Time, on June 23, 2021, unless extended by the Company (the
“Expiration Date”).
If you are purchasing shares of Common Stock in order to
participate in the rights offering, you need to make sure that the
settlement of your purchase occurs on or prior to June 11, 2021,
the record date for the rights offering. As a general matter, the
settlement date for most stock trades occurs on the second business
day after the day the trade is executed (commonly referred to as
T+2). We urge you to contact your broker dealer to discuss and
confirm the timing of settlement of purchase of shares of Common
Stock.
Affiliates of CIM Group, L.P. that operate and manage the
Company and beneficially owned approximately 19.9% of the issued
and outstanding shares of Common Stock as of May 7, 2021 have
indicated to us that they will exercise in full the subscription
rights they receive in the rights offering and intend to
over-subscribe for additional shares of Common Stock.
Exercising holders will be required to pay the subscription
price in full for all shares of Common Stock sought to be acquired
in the rights offering (including in respect of any shares sought
to be over subscribed for) at the time of submission of their
exercise notice. Holders that hold their shares of Common Stock as
of the record date through a broker, dealer, bank, trustee, TASE
member or other nominee should be aware that such nominee is likely
to establish a deadline by which the nominee must receive
instructions for the exercise of subscription rights, together with
the required subscription payment, that is prior to the Expiration
Date. Following the Expiration Date, the Company will publicly
announce the results of the rights offering (including the number
of shares of Common Stock to be issued in connection with the over
subscription privilege). Shares of Common Stock subscribed for and
allocated to exercising stockholders are expected to be issued
within six business days following the Expiration Date. Any holder
that subscribes and pays for a greater number of shares of Common
Stock than are allocated to such holder in the rights offering will
be refunded the amount of overpayment, without interest or
deduction, as soon as practicable after the Expiration Date.
The Company has retained B. Riley Securities, Inc. to act as a
U.S. dealer manager and Poalim I.B.I. – Underwriting and Issuing
Ltd. to act as an Israeli dealer manager in connection with the
rights offering.
The rights offering will be made pursuant to the Company’s
Registration Statement on Form S-3 (File No. 333-233255) that was
previously filed with the Securities and Exchange Commission (the
“SEC”) and became effective on November 27, 2019. The rights
offering will only be made by means of a prospectus. The Company is
filing with the SEC in respect of the rights offering a preliminary
prospectus supplement and the accompanying base prospectus, which
will be available on the SEC’s web site. The Company may decide at
any time prior to the filing of the final prospectus supplement in
respect of the rights offering (which is expected to be one
business day prior to the record date) not to proceed with the
rights offering, in which case no subscription rights will be
distributed to holders of Common Stock.
About CIM Commercial
CIM Commercial is a real estate investment trust that primarily
acquires, owns, and operates Class A and creative office assets in
vibrant and improving metropolitan communities throughout the
United States. Its properties are primarily located in Los Angeles
and the San Francisco Bay Area. CIM Commercial is operated by
affiliates of CIM Group, L.P., a vertically-integrated owner and
operator of real assets with multi-disciplinary expertise and
in-house research, acquisition, credit analysis, development,
finance, leasing, and onsite property management capabilities
(www.cimcommercial.com).
IMPORTANT
This press release shall not constitute an offer to sell or a
solicitation of an offer to buy any securities of the Company or
any of its subsidiaries, nor shall there be any offer, solicitation
or sale of any securities of the Company or any of its subsidiaries
in any state or jurisdiction in which such offer, solicitation or
sale would be unlawful under the securities laws of such state or
jurisdiction.
FORWARD-LOOKING STATEMENTS
This press release contains “forward-looking statements” within
the meaning of the Private Securities Litigation Reform Act of 1995
regarding the potential rights offering, including statements
containing the words "will,” “expect,” “potential,” “opportunities”
and words of similar import. There can be no assurance (i) that the
potential rights offering will be commenced or, if commenced, will
be consummated on the terms described in this press release, (ii)
of the amount of net proceeds that will be raised by the potential
rights offering or (iii) that the Company will be able to use the
proceeds from the potential rights offering as anticipated or, even
if so used, that the effects of such uses will be as anticipated.
For a further list and description of the risks and uncertainties
inherent in forward-looking statements, see the Annual Report on
Form 10-K (as amended) filed by the Company in respect of the
fiscal year ended December 31, 2020, and the preliminary prospectus
supplement relating to the rights offering filed by the Company
with the SEC on June 1, 2021. Forward-looking statements are not
guarantees of performance or results and speak only as of the date
such statements are made. CIM Commercial undertakes no obligation
to publicly update or release any revisions to its forward-looking
statements, whether to reflect new information, future events,
changes in assumptions or circumstances or otherwise, except as
required by law.
FREE WRITING PROSPECTUS | CIM COMMERCIAL TRUST
CORPORATION
FILED PURSUANT TO RULE 433 | DATED JUNE 1, 2021 |
REGISTRATION STATEMENT NO. 333-233255
CIM Commercial has filed a registration statement (including a
base prospectus) with the Securities and Exchange Commission (the
“SEC”) in respect of the offering to which this press release
relates. Before you invest in the potential rights offering, you
should read the preliminary prospectus supplement, dated June 1,
2021 (and, when it becomes available, the final prospectus
supplement) and the accompanying base prospectus, dated December 4,
2019. Before making any investment in the potential rights
offering, you should read the other documents CIM Commercial has
filed with the SEC for more complete information about CIM
Commercial and the potential and the rights offering. You may
obtain these documents for free by visiting EDGAR on the SEC web
site at www.sec.gov. You may request to receive a prospectus in
respect of the potential rights offering by calling toll-free at
1-866-341-2653.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210601005609/en/
Media Relations: Karen Diehl, Diehl Communications, 310-741-9097
karen@diehlcommunications.com or Shareholder Relations: Steve
Altebrando, 646-652-8473 shareholders@cimcommercial.com
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