Item 1.01 Entry into a Material Definitive Agreement.
Merger Agreement
On
Under the terms of the Merger Agreement, at the effective time of the Merger (the "Effective Time"), each issued and outstanding share of common stock of Capstead ("Capstead Common Stock") will be converted into the right to receive:
• from BSPRT, (A) a number of shares of BSPRT's common stock,$0.01 par value per share (which will be renamed Class A common stock) ("BSPRT Common Stock") equal to the quotient (rounded to the nearest one ten-thousandth) (the "Exchange Ratio") determined by dividing (i) Capstead's adjusted book value per share by (ii) BSPRT's adjusted book value per share (the "Per Share Stock Consideration"), and (B) a cash amount equal to the product of (rounding to the nearest cent) (x) Capstead's adjusted book value per share multiplied by 15.75%, multiplied by (y) 22.5%, without any interest thereon (the "Per Share Cash Consideration" and together with the Per Share Stock Consideration, the "Per Common Share BSPRT Consideration"); and • from the Parent Manager, a cash amount equal to the product of (rounding to the nearest cent) (A) Capstead's adjusted book value per share multiplied by 15.75%, multiplied by (B) 77.5%, without any interest thereon (the "Parent Manager Cash Consideration" and together with the Per Common Share BSPRT Consideration, the "Total Per Common Share Consideration").
In addition, each outstanding share of Capstead's 7.50% Series E Cumulative
Redeemable Preferred Stock,
All outstanding restricted stock under Capstead's Amended and Restated 2014 Flexible Incentive Plan will, as of the Effective Time, automatically become fully vested and eligible to receive the Total Per Common Share Consideration. All performance units under Capstead's Amended and Restated 2014 Flexible Incentive Plan will, as of the Effective Time, automatically become earned and vested at the conversion rate of one share of Capstead Common Stock for each performance unit and eligible to receive the Total Per Common Share Consideration. Each outstanding dividend equivalent right will, as of the Effective Time, automatically be cancelled; provided, that any accrued amounts not yet paid will be paid to the holders thereof at the Effective Time (or as soon as practicable thereafter but in no event later than the first payroll date following the Effective Time), less applicable income and employment tax withholdings.
Under the Merger Agreement, each of Capstead and BSPRT will pay a special dividend to their respective stockholders in cash on the last business day prior to the closing of the Merger, with a record date that is three business days before the payment date. Any dividends paid by Capstead with respect to the Capstead Common Stock prior to the closing of the Merger will not exceed Capstead's core earnings for the quarter (or portion thereof) in which such dividend is declared, plus an additional amount, if any, necessary so that the aggregate dividend payable is equal to the minimum amount to avoid adverse tax consequences.
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For
Item 2.02 Results of Operations and Financial Condition.
On
Item 5.03 Amendments to Articles of Incorporation or By-Laws; Change in Fiscal Year.
On
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that (i) none of the foregoing actions, claims or proceedings may be brought in
any court sitting outside the
The foregoing description of the amendment to the Bylaws does not purport to be complete and is qualified in its entirety by reference to the amendment to the Bylaws, a copy of which is attached as Exhibit 3.1 hereto and is hereby incorporated into this Current Report on Form 8-K by reference.
Item 7.01 Regulation FD Disclosure.
On
The information in Item 2.02 and Item 7.01 of this Current Report on Form 8-K, including Exhibits 99.1 and 99.2 attached hereto, shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall such information, including Exhibits 99.1 and 99.2, be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, regardless of the general incorporation language of such filing, except as shall be expressly set forth by specific reference in such filing.
Item 9.01 Financial Statements and Exhibits.
(a) Not Applicable. (b) Not Applicable. (c) Not Applicable. (d) Exhibits. Exhibit 2.1 Agreement and Plan of Merger, dated as ofJuly 25, 2021 , by and amongBenefit Street Partners Realty Trust, Inc. ,Rodeo Sub I, LLC ,Capstead Mortgage Corporation andBenefit Street Partners L.L.C. * Exhibit 3.1 Amendment to the Amended and Restated Bylaws ofCapstead Mortgage Corporation , datedJuly 25, 2021 Exhibit 99.1 Joint Press Release, datedJuly 26, 2021 , issued byCapstead Mortgage Corporation andBenefit Street Partners Realty Trust, Inc. Exhibit 99.2 Investor Presentation, datedJuly 26, 2021 Exhibit 104 Cover Page Interactive Data File (embedded within the Inline XBRL document)
* Schedules omitted pursuant to Item 601(b)(2) of Regulation S-K. Capstead agrees
to furnish a supplemental copy of any omitted schedule to the
Important Additional Information and Where to Find It
In connection with the proposed Merger, BSPRT will file with the
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CAPSTEAD, BSPRT, THE PROPOSED MERGER AND RELATED MATTERS. Stockholders of
Capstead and BSPRT may obtain free copies of the registration statement, the
proxy statement/prospectus and all other documents filed or that will be filed
with the
Participants in the Solicitation Relating to the Merger
Capstead, BSPRT, their respective directors and executive officers and certain
other affiliates of Capstead or BSPRT may be deemed to be "participants" in the
solicitation of proxies from the stockholders of Capstead in connection with the
proposed Merger. Information regarding Capstead and its directors and executive
officers and their ownership of common stock of Capstead can be found in
Capstead's annual report on Form 10-K for the fiscal year ended
No Offer or Solicitation
This communication and the information contained herein 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, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended. This communication may be deemed to be solicitation material in respect of the proposed Merger.
Forward-Looking Statements
This communication contains statements that constitute 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. Such forward-looking statements include or may relate to statements about the benefits of the proposed Merger involving Capstead and BSPRT and statements that address operating performance, events or developments that Capstead expects or anticipates will occur in the future, including but not limited to statements regarding future financial and operating results, plans, objectives, expectations and intentions, expected sources of financing, anticipated asset dispositions, anticipated leadership and governance changes, changes to outstanding structure of Capstead's capital stock, creation of value for stockholders, operation and implementation of share repurchase programs, benefits of the proposed Merger to customers, stockholders and other constituents of the combined company, the integration of Capstead and BSPRT, the expected GAAP book value per share of Capstead, cost savings and the expected timetable for completing the proposed Merger and other non-historical statements. These statements are based on the companies' current expectations and beliefs and are subject to a number of trends and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements; Capstead can give no assurance that its expectations will be attained. Factors that could cause actual results to differ materially from Capstead's expectations include, but are not limited to, the risk that the 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 Merger Agreement; the failure to satisfy the conditions to the consummation of the proposed Merger, including the approval of the stockholders of Capstead; fluctuations in the adjusted book value per share of both Capstead and BSPRT; risks related to the disruption of management's attention from ongoing business operations due to the proposed Merger; the availability of suitable
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investment or disposition opportunities; changes in interest rates; the
availability and terms of financing; the impact of the COVID-19 pandemic on the
operations and financial condition of each of Capstead and BSPRT and the
industries in which they operate; general financial and economic conditions,
which may be affected by government responses to the COVID-19 pandemic; market
conditions; legislative and regulatory changes that could adversely affect the
business of Capstead and BSPRT; and other factors, including those set forth in
the section entitled "Risk Factors" in BSPRT's and Capstead's most recent annual
reports on Form 10-K, as amended, and quarterly reports on Form 10-Q filed with
the
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