KBS Strategic Opportunity REIT, Inc. signed a definitive merger agreement to acquire Reven Housing REIT, Inc. (NasdaqCM:RVEN) for approximately $56.8 million in cash on August 30, 2019. Under the terms of the deal, the aggregate merger consideration payable for shares of Reven common stock in the merger will be increased or decreased, as the case may be, by the difference, if any, between the amount of Reven’s unrestricted cash available for distribution as of the closing date of the merger, and $6.5 million. Based on Reven management's current estimate, the per share merger consideration payable to Reven stockholders in the merger is expected to be $5.15. Each unvested Reven restricted stock award will become fully vested and will be automatically converted into the right to receive the per share merger consideration for each share of Reven common stock underlying such award. Reven’s existing loan agreements with Arbor Agency Lending, LLC are expected to remain outstanding following the closing of the merger. In connection with the signing of the merger agreement, KBS Strategic Opportunity has delivered to Reven an equity commitment letter, pursuant to which KBS Strategic Opportunity has committed to purchase, directly or indirectly through one or more affiliated entities, equity securities of Parent for a maximum amount equal to the aggregate merger consideration payable under the merger agreement. On September 20, 2019, the parties entered into an Amendment to the Agreement and Plan of Merger pursuant to which the parties agreed to amend certain terms of the Articles Supplementary setting forth the rights, preferences, privileges and voting powers of the series of preferred stock, par value $0.001 per share, of Reven Housing, designated “6.0% Series A Cumulative Convertible Redeemable Preferred Stock. Following the transaction, Reven Housing REIT, Inc. will operates as a wholly owned subsidiary of KBS Strategic Opportunity REIT. On October 21, 2019, the parties entered into amendment No. 2 whereas each eligible stockholder who elects to purchase shares of Series A Preferred Stock in the Preferred Stock Offering (each, a “Participating Stockholder”) will be entitled to allocate a portion of the amount of cash merger consideration that such Participating Stockholder has the right to receive in respect of the Merger towards payment for such shares of Series A Preferred Stock (the aggregate amount allocated by all Participating Stockholders towards payment for the shares of Series A Preferred Stock that they have elected to purchase in the Preferred Stock Offering is referred to as the “Preferred Stock Amount”); and at or prior to the closing of the Merger, Parent will deposit the Preferred Stock Amount with The Bank of New York Mellon, as escrow agent (the “Escrow Agent”) to be held in escrow until such amount is released to the Company as payment for the shares of Series A Preferred Stock purchased by the Participating Stockholders in the Preferred Stock Offering or, if the Preferred Stock Offering is not consummated for any reason, to the paying agent appointed by Parent in connection with the Merger for distribution to the applicable Participating Stockholders in accordance with the terms and conditions of the Merger Agreement. The closing of the merger is subject to customary closing conditions, including approval by a majority of Reven's stockholders and approval of lenders, the information statement shall have been mailed to the stockholders in accordance with Section 5.5(c) and Regulation 14C of the Exchange Act and KBS Strategic Opportunity shall have received an executed written opinion, which opinion concludes that Reven has been organized in conformity with the requirements for qualification and taxation as REIT under the Code, and Reven’s actual method of operation has enabled Reven to meet the requirements for qualification and taxation as a REIT under the Code determined as if Reven’s tax year ended in the Closing Date. The transaction has been unanimously approved by the Board of Directors of KBS Strategic Opportunity and approved by the Board of Directors of Reven. The funding of the commitment under the equity commitment letter is not a condition to KBS Strategic Opportunity's obligation to consummate the merger. The closing of the merger is expected to occur by the end of October 2019. RBC Capital Markets, LLC acted as financial advisor and fairness opinion provider and Daniel K. Donahue and Dmitriy A. Tartakovskiy of Greenberg Traurig, LLP acted as legal advisor to Reven. Robert Bergdolt and Penny J. Minna of DLA Piper LLP (US) served as legal advisor to KBS Strategic Opportunity. RBC Capital Markets will receive a fee of approximately $2.35 million, of which a portion was payable upon delivery of RBC Capital Markets’ opinion and approximately $2.1 million is contingent upon consummation of the transaction.