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): October 2, 2014

 

CUBESMART
CUBESMART, L.P.

(Exact Name of Registrant as Specified in its Charter)

 

 

 

5 Old Lancaster Road
Malvern, PA 19355
(Address of principal executive offices) (Zip Code)

 

(610) 535-5700
(Registrant’s telephone number, including area code)

 

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))

 

 

 

Item 1.01 Entry into a Material Definitive Agreement

 

On October 2, 2014, CubeSmart, a Maryland real estate investment trust (the “Company”), and CubeSmart, L.P., a Delaware limited partnership (the “Operating Partnership”), entered into separate amendments (the “Amendments”) to each of the Equity Distribution Agreements (as amended, collectively, the “Equity Distribution Agreements”) entered into on May 7, 2013 and initially amended on May 5, 2014 with each of Wells Fargo Securities, LLC, BMO Capital Markets Corp., Jefferies LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated and RBC Capital Markets, LLC (collectively, the “Sales Agents”) in connection with the Company’s “at-the-market” offering program (the “Offering”). The Amendments increased the number of common shares of beneficial interest of the Company, $0.01 par value per share (the “Common Shares”) which the Company may now sell through the Sales Agents, from time to time, under the Equity Distribution Agreements to 30,000,000.

 

The Common Shares are being offered and sold pursuant to the Company’s automatic shelf registration statement on Form S-3 (Registration No. 333-194661) (the “Shelf Registration Statement”) filed with the Securities and Exchange Commission (the “SEC”) on March 18, 2014, which became effective immediately upon filing. A prospectus supplement relating to the Offering has been filed today with the SEC to continue the Offering under the Shelf Registration Statement.

 

The legal opinion of Pepper Hamilton LLP relating to the legality of the shares offered by the prospectus supplement and the legal opinion of Pepper Hamilton with respect to certain tax matters are attached as Exhibit 5.1 and Exhibit 8.1, respectively, to this Current Report.

 

The Company intends to contribute the net proceeds from the offering of the Common Shares to the Operating Partnership in exchange for partnership units of the Operating Partnership. The Operating Partnership intends to use the net proceeds from the Offering for general business purposes, including, without limitation, facility acquisitions, developments, joint ventures, capital expenditures, working capital and other general corporate purposes.

 

The other specifics of the Equity Distribution Agreements are incorporated by reference from the Company’s Current Reports on Form 8-K filed with the Securities and Exchange Commission on May 7, 2013 and May 5, 2014.  The Form of Amendments is filed as Exhibit 1.1 hereto, and the description of the material terms of the Amendments in this Item 1.01 is qualified in its entirety by reference to such Exhibit, which is incorporated herein by reference.

 

This Current Report on Form 8-K shall not constitute an offer to sell or a solicitation of an offer to buy any securities, nor shall there be any sale of these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or other jurisdiction.

 

Item 3.02 Unregistered Sales of Equity Securities

 

The information about the issuance by the Operating Partnership of additional partnership units under Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 3.02.

 

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Item 9.01.  Financial Statements and Exhibits.

 

(d)           Exhibits

 

Exhibit No.		Description
1.1		Form of Amendment No. 2 to Equity Distribution Agreement, dated October 2, 2014, by and among CubeSmart, CubeSmart, L.P. and each of the Sales Agents.
5.1		Opinion of Pepper Hamilton LLP regarding the legality of the shares offered.
8.1		Opinion of Pepper Hamilton LLP with respect to certain tax matters.
23.1		Consent of Pepper Hamilton LLP (included in Exhibit 5.1).
23.2		Consent of Pepper Hamilton LLP (included in Exhibit 8.1).

 

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Signatures

 

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

 

 

	CubeSmart
	By:	/s/ Jeffrey P. Foster
		Jeffrey P. Foster
		Senior Vice President, Chief Legal Officer & Secretary
	CubeSmart, L.P.
	By: CubeSmart, its general partner
	By:	/s/ Jeffrey P. Foster
		Jeffrey P. Foster
		Senior Vice President, Chief Legal Officer & Secretary

 

 

Date: October 2, 2014

 

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EXHIBIT INDEX

 

Exhibit No.		Description
1.1		Form of Amendment No. 2 to Equity Distribution Agreement, dated October 2, 2014, by and among CubeSmart, CubeSmart, L.P. and each of the Sales Agents.
5.1		Opinion of Pepper Hamilton LLP regarding the legality of the shares offered.
8.1		Opinion of Pepper Hamilton LLP with respect to certain tax matters.
23.1		Consent of Pepper Hamilton LLP (included in Exhibit 5.1).
23.2		Consent of Pepper Hamilton LLP (included in Exhibit 8.1).

 

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Exhibit 1.1

 

CUBESMART

 

Form of AMENDMENT NO. 2

 

TO

 

EQUITY DISTRIBUTION AGREEMENT

 

October 2, 2014

 

[Manager]

[Manager Address]

[Manager Address]

 

Ladies and Gentlemen:

 

Reference is made to the Equity Distribution Agreement, dated May 7, 2013, as amended by Amendment No. 1 to Equity Distribution Agreement, dated May 5, 2014 (as amended, the “Equity Distribution Agreement”), among [Manager] (the “Manager”) and CubeSmart, a Maryland real estate investment trust (the “Company”), and CubeSmart, L.P., a Delaware limited partnership (the “Operating Partnership” and together with the Company, the “Transaction Entities”), pursuant to which the Company agreed to sell through the Manager, acting as agent and/or principal, up to 20,000,000 shares of the Company’s common shares of beneficial interest, par value $0.01 per share.  All capitalized terms used in this Amendment No. 2 to the Equity Distribution Agreement among the Manager and the Transaction Entities (this “Amendment”) and not otherwise defined shall have the respective meanings assigned to them in the Equity Distribution Agreement.  The Manager and the Transaction Entities agree as follows:

 

A.                                    Amendments to Equity Distribution Agreement.  The Equity Distribution Agreement is further amended as follows:

 

1.                                      The first sentence of the first paragraph of Section 1 of the Equity Distribution Agreement is hereby deleted and replaced with the following:

 

“The Company agrees that, from time to time during the term of this Agreement, on the terms and subject to the conditions set forth herein, it may issue and sell through [Manager], acting as agent and/or principal, up to 30,000,000 shares (the “Maximum Amount”) of the Company’s common shares of beneficial interest, par value $0.01 per share (the “Shares”).”

 

 

2.                                      The last sentence of Section 1 of the Equity Distribution Agreement is hereby deleted and replaced with the following:

 

“The Transaction Entities have also entered into separate equity distribution agreements, dated as of May 7, 2013, as amended by Amendment No. 1 to such agreements, dated as of May 5, 2014, and as further amended by Amendment No. 2 to such agreements, dated as of even date herewith (as amended, the “Alternative Distribution Agreements”), with each of [Wells Fargo Securities, LLC], [BMO Capital Markets Corp.], [Jefferies LLC], [Merrill Lynch, Pierce, Fenner & Smith Incorporated] and [RBC Capital Markets, LLC] (the “Alternative Managers”).”

 

3.                                      The first sentence of the Form of Placement Notice attached as Schedule 1 to the Equity Distribution Agreement shall be amended to add “, as amended on May 5, 2014, and as further amended on October 2, 2014” immediately before “(the “Agreement”)”.

 

4.                                      Schedule 4 to the Equity Distribution Agreement shall be replaced in its entirety with the schedule set forth as Exhibit A hereto.

 

5.                                      The first sentence of the Form of Officer Certificate attached as Exhibit 7(n) to the Equity Distribution Agreement is amended to add “, as amended on May 5, 2014, and as further amended on October 2, 2014” immediately before “(the “Sales Agreement”)”.

 

B.                                    Prospectus Supplement.  The Company agrees to file a 424(b) Prospectus Supplement reflecting this Amendment within 2 business days of the date hereof.

 

C.                                    No Other Amendments.  Except as set forth in Part A above, all the terms and provisions of the Equity Distribution Agreement shall continue in full force and effect.

 

D.                                    Counterparts.  This Amendment may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.  Delivery of an executed Amendment by one party to the other may be made by facsimile or email transmission.

 

[Remainder of page intentionally left blank]

 

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If the foregoing correctly sets forth the understanding among the parties hereto, please so indicate in the space provided below for that purpose, whereupon this Amendment No. 2 to Equity Distribution Agreement shall constitute a binding agreement among the parties hereto.

 

 

	Very truly yours,
	CUBESMART
	By:
		Name: Timothy M. Martin
		Title: Chief Financial Officer
	CUBESMART, L.P.
	By:	CubeSmart, its general partner
	By:
		Name: Timothy M. Martin
		Title: Chief Financial Officer

 

 

ACCEPTED as of the date first-above written:
[Manager]
By:
	Name:
	Title:

 

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EXHIBIT A

 

SCHEDULE OF SUBSIDIARIES

 

 

 

 

 

 

Exhibit 5.1

 

 

3000 Two Logan Square

Eighteenth and Arch Streets

Philadelphia, PA  19103-2799

215.981.4000

Fax 215.981.4750

 

October 2, 2014

 

CubeSmart

5 Old Lancaster Road

Malvern, PA 19355

 

Re:               Registration Statement on Form S-3

 

Dear Ladies and Gentlemen:

 

We have acted as special counsel to CubeSmart, a Maryland real estate investment trust (the “Company”), and CubeSmart, L.P., a Delaware limited partnership (the “Operating Partnership”), in connection with the preparation of a registration statement on Form S-3 (Registration Statement No. 333-194661) (the registration statement, including all information deemed to be a part thereof pursuant to Rule 430B of the general rules and regulations under the Securities Act (as defined below), the exhibits and schedules thereto and all documents incorporated by reference therein, is herein referred to as the “Registration Statement”), filed with the Securities and Exchange Commission (the “Commission”) under the Securities Act of 1933, as amended (the “Securities Act”), including the base prospectus contained therein (the “Base Prospectus”) and the preparation of the prospectus supplement, dated October 2, 2014 (the “Prospectus Supplement,” and together with the Base Prospectus and all documents incorporated by reference therein, the “Prospectus”) related to the offer and sale from time to time of up to 10,000,000 common shares of beneficial interest, par value $0.01 per share, of the Company (the “Common Shares”), pursuant to (i) the Equity Distribution Agreement, dated as of May 7, 2013, by and among the Company, the Operating Partnership and Wells Fargo Securities, LLC, as amended as of the date hereof; (ii) the Equity Distribution Agreement, dated as of May 7, 2013, by and among the Company, the Operating Partnership and RBC Capital Markets, LLC, as amended as of the date hereof; (iii) the Equity Distribution Agreement, dated as of May 7, 2013, by and among the Company, the Operating Partnership and BMO Capital Markets Corp, as amended as of the date hereof; (iv) the Equity Distribution Agreement, dated as of May 7, 2013, by and among the Company, the Operating Partnership and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as amended as of the date hereof; and (v) the Equity Distribution Agreement, dated as of May 7, 2013, by and among the Company, the Operating Partnership and Jefferies LLC, as amended as of the date hereof (such agreements, as may be amended from time to time, collectively, the “Equity Distribution Agreements” and, individually, each an “Equity Distribution Agreement”).

 

In connection with our representation of the Company, and as a basis for the opinions hereinafter set forth, we have examined originals, or copies certified or otherwise identified to our satisfaction, of the following documents (hereinafter collectively referred to as the “Documents”):

 

1. The Registration Statement, including the Prospectus;

 

 

www.pepperlaw.com

 

 

2. The Articles of Amendment and Restatement of Declaration of Trust of the Company, as amended and supplemented through the date hereof (the “Declaration of Trust”), certified as of a recent date by the State Department of Assessments and Taxation of the State of Maryland (the “SDAT”);

 

3. The Third Amended and Restated Bylaws of the Company, as amended through the date hereof;

 

4. A certificate of the SDAT as to the good standing of the Company, dated as of a recent date;

 

5. Resolutions adopted by the Board of Trustees of the Company, or a duly authorized committee thereof, relating to the offer and sale of the Common Shares (the “Resolutions”), certified by an officer of the Company as being complete, accurate and in effect;

 

6. The Equity Distribution Agreements; and

 

7. Such other documents, records, instruments, and matters as we have deemed necessary or appropriate to express the opinion set forth below, subject to the assumptions, limitations and qualifications stated herein.

 

In expressing the opinion set forth below, we have assumed the following:

 

1. Each individual executing any of the Documents is legally competent to do so.

 

2. Each individual executing any of the Documents on behalf of a party (other than the Company and the Operating Partnership) is duly authorized to do so.

 

3. All Documents submitted to us as originals are authentic.  The form and content of all Documents submitted to us as unexecuted drafts do not differ in any respect relevant to this opinion from the form and content of such Documents as executed and delivered.  All Documents submitted to us as certified or photostatic copies conform to the original documents.  All signatures on all Documents are genuine. All public records reviewed or relied upon by us or on our behalf are true and complete.  All statements and information contained in the Documents are true and complete.  There has been no oral or written modification of or amendment to any of the Documents, and there has been no waiver of any provision of any of the Documents, by action or conduct of the parties or otherwise.

 

4. The Common Shares will not be issued or transferred in violation of any restriction on ownership and transfer set forth in Article VII of the Declaration of Trust or other organizational document of the Company.

 

5.     A sufficient number of authorized but unissued Common Shares will be available for issuance when Common Shares are issued and sold under the Equity Distribution Agreements.

 

Subject to the foregoing, it is our opinion that, as of the date hereof, the Common Shares have been duly authorized by all necessary action on the part of the Company and, upon issuance, delivery and payment therefore in the manner contemplated by the Equity Distribution Agreements, the Common Shares will be validly issued, fully paid and non-assessable.

 

The foregoing opinion is limited to the substantive laws of the State of Maryland and we do not express any opinion herein concerning any other law.  We express no opinion as to compliance with any federal or state securities laws, including the securities laws of the State of Maryland, or as to federal or state laws regarding fraudulent transfers.  We assume no obligation to supplement this opinion if any

 

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applicable law changes after the date hereof or if we become aware of any fact that might change the opinion expressed herein after the date hereof.

 

No opinion is rendered as to matters not specifically referred to herein and under no circumstances are you to infer from anything stated or not stated herein any opinion with respect to which such reference is not made.

 

This opinion is being furnished to you for your submission to the Commission as an exhibit to a current report filed on Form 8-K (the “8-K”), to be filed by the Company with the Commission on or about the date hereof.  We hereby consent to the filing of this opinion as an exhibit to the 8-K and to the use of the name of our firm therein and under the section “Legal Matters” in the Registration Statement, the Prospectus and the Prospectus Supplement.  In giving this consent, we do not admit that we are within the category of persons whose consent is required by Section 7 of the Securities Act.

 

	Very truly yours,
	/s/ Pepper Hamilton
	PEPPER HAMILTON LLP

 

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Exhibit 8.1

 

 

3000 Two Logan Square

Eighteenth and Arch Streets

Philadelphia, PA  19103-2799

215.981.4000

Fax 215.981.4750

 

October 2, 2014

 

CubeSmart

460 East Swedesford Road, Suite 3000
Wayne, Pennsylvania 19087

 

Ladies and Gentlemen:

 

We have acted as counsel to CubeSmart, a Maryland real estate investment trust (the “Company”), and CubeSmart, L.P., a Delaware limited partnership (the “Operating Partnership”) in connection with the preparation of a Prospectus Supplement, dated October 2, 2014 (the “Prospectus Supplement”), to a Prospectus (the “Prospectus”), included as part of the Registration Statement on Form S-3 (Registration No. 333-194661) filed by the Company and Operating Partnership under the Securities Act of 1933 (the “1933 Act”) with the Securities and Exchange Commission (the “Commission”) on March 18, 2014 (as the same may be amended and supplemented, the “Registration Statement”), registering for sale certain securities.  Any capitalized terms used but not defined herein shall have the meanings given to such terms in the Registration Statement, the Prospectus and the Prospectus Supplement.

 

The opinions expressed herein are based on the Internal Revenue Code of 1986, as amended (the “Code”), Treasury regulations thereunder (including proposed and temporary Treasury regulations) and interpretations of the foregoing as expressed in court decisions, legislative history and administrative determinations of the Internal Revenue Service (the “IRS”) (including its practices and policies in issuing private letter rulings, which are not binding on the IRS, except with respect to a taxpayer that receives such a ruling), all as of the date hereof.  This opinion represents our best legal judgment with respect to the probable outcome on the merits and is not binding on the IRS or the courts.  There can be no assurance that positions contrary to our opinion will not be taken by the IRS, or that a court considering the issues would not reach a conclusion contrary to such opinions.  No assurance can be given that future legislative, judicial or administrative changes, on either a prospective or retroactive basis, would not adversely affect the opinions expressed herein.

 

In rendering the opinions expressed herein, we have examined such statutes, regulations, records, certificates and other documents as we have considered necessary or appropriate as a basis for such opinions, including: (1) the Articles of Amendment and Restatement of Declaration of Trust of Company, as amended or supplemented through the date hereof and (2) the Second Amended and Restated Agreement of Limited Partnership of the Operating Partnership dated as of October 27, 2004, as amended or supplemented through the date hereof.

 

In rendering the opinions expressed herein, we have relied upon written representations as to factual matters of Company and Operating Partnership contained in an Officer’s Certificate

 

 

www.pepperlaw.com

 

 

Regarding Certain Tax Matters dated October 2, 2014 regarding their consolidated assets, operations and activities (the “Officer’s Certificate”).  We have not made an independent investigation or audit of the facts set forth in the Officer’s Certificate or in any other document.  We consequently have relied upon the accuracy of the representations as to factual matters in the Officer’s Certificate.  After inquiry, we are not aware of any facts or circumstances contrary to, or inconsistent with, the representations that we have relied upon or the other assumptions set forth herein.  Our opinion is limited to the tax matters specifically covered herein, and we have not addressed, nor have we been asked to address, any other tax matters relevant to Company, the Operating Partnership or any other person.

 

We have assumed, with your consent, that, insofar as relevant to the opinions expressed herein:

 

(1)                                 the Company has been and will be operated in the manner described in the Officer’s Certificate and the Registration Statement (including in the documents incorporated therein by reference);

 

(2)                                 all of the obligations imposed by the documents that we reviewed have been and will continue to be performed or satisfied in accordance with their terms; and all of such documents have been properly executed, are valid originals or authentic copies of valid originals, and all signatures thereon are genuine;

 

(3)                                 all representations made in the Officer’s Certificate (and other factual information provided to us) are true, correct and complete and will continue to be true, correct and complete, and any representation or statement made in the Officer’s Certificate “to the best of knowledge,” “to the knowledge” or “to the actual knowledge” of any person(s) or party(ies) or similarly qualified is true, correct and complete as if made without such qualification; and

 

(4)                                 all documents that we have reviewed have been properly executed, are valid originals or authentic copies of valid originals, and all signatures thereon are genuine.

 

Based upon, subject to the foregoing and the discussion below, we are of the opinion that:

 

1.                                      Commencing with its taxable year ended December 31, 2004, the Company has been organized and operated in conformity with the requirements for qualification as a REIT under the Code,  and the Company’s current organization and current and proposed method of operation will enable it to continue to meet the requirements for qualification and taxation as a REIT under the Code for its taxable year ending December 31, 2014 and thereafter.

 

2.                                      The discussion in the Registration Statement under the heading “Material Federal Income Tax Considerations,” to the extent it describes provisions of federal income tax law and regulations or legal conclusions with respect thereto, is correct in all material respects as of the date hereof.

 

We assume no obligation to advise you of any changes in our opinion subsequent to the date of this letter.  The Company’s qualification for taxation as a REIT depends upon the Company’s ability to meet, on a continuing basis, through actual annual operating and other results, the requirements of the Code, including the requirements with regard to the sources of its gross income, the composition of

 

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its assets, the level of its distributions to shareholders and the diversity of its share ownership.  We will not review Company’s compliance with these requirements on a continuing basis.  Accordingly, no assurance can be given that the actual results of Company’s operations, the sources of its income, the nature of its assets, the level of its distributions to shareholders and the diversity of its share ownership for any given taxable year will satisfy the requirements under the Code for qualification and taxation as a REIT.

 

This opinion letter has been prepared for your use in connection with the Prospectus Supplement, including submission to the Commission as an exhibit to a current report filed on Form 8-K (the “8-K”), to be filed by the Company with the Commission on or about the date hereof, and speaks as of the date hereof.  We do not purport to express any opinion herein concerning any law other than the federal income tax law of the United States. We consent to the filing of this legal opinion as an exhibit to the 8-K and to the use of the name of our firm therein and under the section “Legal Matters” in the Registration Statement, the Prospectus, and the Prospectus Supplement.  In giving this consent, we do not admit that we are within the category of persons whose consent is required under Section 7 of the 1933 Act.

 

	Very truly yours,
	/s/ Pepper Hamilton
	PEPPER HAMILTON LLP

 

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