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Section 1: 8-K (8-K)

Document


 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of report (Date of earliest event reported):
March 20, 2020
Steadfast Apartment REIT, Inc.
(Exact Name of Registrant as Specified in Charter)

 
 
 
 
 
Maryland
 
000-55428
 
36-4769184
(State or Other Jurisdiction
 
(Commission File Number)
 
(IRS Employer
of Incorporation)
 
 
 
Identification No.)
18100 Von Karman Avenue, Suite 500
Irvine, California 92612
(Address of Principal Executive Offices, including Zip Code)
Registrant’s telephone number, including area code: (949) 852-0700
Not applicable
(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
 
 
 
 
o
 
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
 
 
 
 
o
 
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
 
 
 
 
o
 
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
 
 
 
 
o
 
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act: None
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
N/A
N/A
N/A
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company x
 
 
 
 
 
 
 
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. x
 





Item    8.01 Other Events.
Acquisition of VV&M Apartments
On March 20, 2020, the Company, through its indirect wholly-owned subsidiary Steadfast Apartment REIT III Operating Partnership, L.P., a Delaware limited partnership (“STAR III OP”), agreed to acquire the 301-unit multifamily property located in Dallas, Texas known as VV&M Apartments (“VV&M”) for an aggregate purchase price of $59,250,000, pursuant to the terms of the Contribution Agreement, dated as of March 20, 2020 (the “Contribution Agreement”), by and among STAR III OP, as Purchaser, and Wellington VVM, LLC and Copans VVM, LLC (collectively, the “Contributors”).
The Contribution Agreement provides that at closing, the Contributors will contribute VV&M to STAR III OP and STAR III OP will issue $14,500,000 in new class A-2 operating partnership units (the “Class A-2 OP Units”), subject to adjustment, and assume $44,800,000 in existing mortgage debt secured by VV&M (the “Loan”). The Loan accrues interest at 3.82% per annum.
On the closing date, the parties will enter into a Second Amended and Restated Agreement of Limited Partnership of STAR III OP (“STAR III OP Agreement”) that provides for conversion and repurchase rights for the Contributors after five years from closing. The STAR III OP Agreement also provides STAR III OP the right to repurchase the Class A-2 OP Units after five years from the closing.
The closing of the transaction is conditioned upon obtaining lender’s consent to the assumption of the Loan by STAR III OP.

Letter to Stockholders
On or about March 24, 2020, the Company is sending a letter to its stockholders regarding the Company’s response to COVID-19. A copy of the stockholder letter is attached as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.






Item 9.01    Financial Statements and Exhibits.
(d) Exhibits.
Exhibits
Description
 
 
 
 
 
 
 
 
99.1






SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 
 
STEADFAST APARTMENT REIT, INC.
 
 
 
 
 
 
 
 
Date:
March 24, 2020
By:
/s/ Ella S. Neyland
 
 
 
Ella S. Neyland
 
 
 
President





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Section 2: EX-99.1 (EXHIBIT 99.1)

Exhibit
EXHIBIT 99.1
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March 24, 2020

Dear Fellow Stockholder,

In just over two months, coronavirus (COVID-19) has gone from obscurity to a pandemic affecting every facet of American life. The well-being of our associates and their families is paramount, as is the need to provide essential services to the multifamily residents at our 69 properties. These two primary considerations have driven our planning and decision making around COVID-19.

We know that you depend on us to be diligent stewards of the money you have invested with us and wanted to let you know that Steadfast leadership is monitoring the situation closely with the goal of remaining ahead of the curve in our response to this rapidly changing event.

Much of the framework we are utilizing is embedded within the Steadfast culture and values that are centered around continuing to execute our core objectives even in an adverse environment:

We intend to provide uninterrupted—although limited—services to our residents. This means reduced office hours and the closure of non-essential amenities.

Our resident portal system allows us to continue to collect rent payments, address urgent maintenance requests and communicate with residents.

At a corporate level, we utilize technology that enables us to continue day-to-day operations without disruption, even when working remotely.

At this time, we believe we have sufficient cash on hand for the near term.


While we recognize that these times are anything but typical, we will be steadfast and confront this crisis with determination and unwavering support for one another and will come out stronger on the other side. We wish you health and safety in the weeks to come.

Sincerely,

403390368_rodssiga01.jpg
Rodney F. Emery
Chairman and Chief Executive Officer





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Cautionary Statement Regarding Forward Looking Statements

Information in this stockholder letter contains statements that constitute “forward-looking statements,” as such term is defined in Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended, and such statements are intended to be covered by the safe harbor provided by the same. These statements are based on management’s 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. The Company can give no assurance that its expectations will be attained. Factors that could cause actual results to differ materially from the Company’s expectations include, but are not limited to; the spread of COVID-19 and its impact on the health and well-being of the Company’s tenants and employees of its advisor and property manager, the Company's tenants ability to pay rent; the Company's ability to maintain operations and occupancy at its multifamily apartments; the availability of investment opportunities; the availability and terms of financing; general economic and market conditions; and other factors, including those set forth in the Risk Factors section of the Company’s most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”), and other reports filed by the Company with the SEC, copies of which are available on the SEC’s website, www.sec.gov. The Company undertakes no obligation to update these statements for revisions or changes after the date of this release, except as required by law.


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