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(Commission File Number)
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(Address of principal executive Offices)
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Title of each class
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Item 7.01 |
Regulation F-D Disclosure.
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Item 9.01. |
Financial Statements and Exhibits.
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Exhibit No.
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Description
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Press Release dated August 3, 2021.
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Monmouth Real Estate Investment Corporation
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Dated: August 4, 2021
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By:
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/s/ Kevin S. Miller
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Kevin S. Miller
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Chief Financial Officer, its principal financial
officer and principal accounting officer
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• |
Robust strategic review process. The
transaction is the culmination of an extensive strategic review conducted by the Monmouth Board. The Board, working together with its legal and financial advisors, engaged with and solicited proposals from a broad range of investors,
contacting over 90 different potential counterparties and evaluating a number of strategic alternatives before determining the merger with EQC to be the best outcome for stockholders.
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Compelling value for Monmouth stockholders. The
transaction represents a 26% valuation premium to Monmouth’s 30-day average unaffected trading price as of December 18, 2020 and an approximate 4.6% cap rate for our high-quality single-tenant industrial portfolio leased primarily to
investment grade tenants.
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• |
Significant combined company upside potential supported by highly favorable secular trends. The transaction provides Monmouth stockholders with the opportunity to participate in the success of the combined company as it executes its growth strategy and evolves into a market leading
industrial REIT benefitting from strong industrial real estate sector fundamentals driven by the rapidly growing e-commerce industry.
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World-class management team. The merger enables
Monmouth stockholders to benefit from the expertise and proven track record of EQC’s executive team, led by Sam Zell as Chairman and David Helfand as CEO.
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Acquisition strategy to strengthen and diversify industrial portfolio. The combined company intends to grow through acquisitions utilizing its approximately $5 billion of balance sheet capacity and will seek to diversify the portfolio while expanding its tenant base.
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Fully-funded growth strategy. The stable and
recurring cash flows of Monmouth’s portfolio, coupled with EQC’s considerable financial resources, including approximately $2.4 billion in cash following close, will fund the combined company’s growth strategy without having to access the
debt or equity capital markets for the foreseeable future.
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Lower costs and increased liquidity.
Stockholders of the combined company will benefit from approximately $34 million per year in savings following the payoff of Monmouth’s Series C Preferred. In addition, the post-merger public equity market capitalization of approximately
$5.1 billion is expected to provide increased liquidity for stockholders.
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Tax-efficient stock transaction. This
tax-efficient transaction will allow Monmouth common stockholders to defer unrealized gains that would otherwise be realized in a cash sale.
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