ICR-A InPoint Commercial Real Estate Income Inc

 

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): September 08, 2023

 

 

InPoint Commercial Real Estate Income, Inc.

(Exact name of Registrant as Specified in Its Charter)

 

 

Maryland			001-40833	32-0506267
(State or Other Jurisdiction of Incorporation)			(Commission File Number)	(IRS Employer Identification No.)
2901 Butterfield Road
Oak Brook, Illinois				60523
(Address of Principal Executive Offices)				(Zip Code)

 

Registrant’s Telephone Number, Including Area Code: (800) 826-8228

 

N/A

(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:

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
6.75% Series A Cumulative Redeemable Preferred Stock, par value $0.001 per share		ICR PR A		New York Stock Exchange

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 ☒

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. ☒

 

 

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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS: Certain statements in this Current Report on Form 8-K constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Words such as “may,” “could,” “should,” “expect,” “intend,” “plan,” “goal,” “seek,” “anticipate,” “believe,” “estimate,” “predict,” “variables,” “potential,” “continue,” “expand,” “maintain,” “create,” “strategies,” “likely,” “will,” “would” and variations of these terms and similar expressions indicate forward-looking statements. These forward-looking statements reflect the intent, belief or current expectations of our management based on their knowledge and understanding of the business and industry, the economy and other future conditions. These statements are not factual or guarantees of future performance, and we caution stockholders not to place undue reliance on them. Actual results may differ materially from those expressed or forecasted in forward-looking statements due to a variety of risks, uncertainties and other factors, including but not limited to risks related to blind pool offerings, best efforts offerings, use of short-term financing, borrower defaults, changing interest rates, the effects of the COVID-19 pandemic, particularly on hospitality and retail properties, including our hotel, and on related mortgage loans and securities, and other risks detailed in the Risk Factors section in our most recent Annual Report on Form 10-K and in subsequent filings on Form 10-Q as filed with the Securities and Exchange Commission and made available on our website. Forward-looking statements reflect our management’s view only as of the date they are made and may ultimately prove to be incorrect. We undertake no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results except as required by applicable law. We intend for these forward-looking statements to be covered by the applicable safe harbor provisions created by Section 27A of the Securities Act and Section 21E of the Exchange Act.

Item 7.01 Regulation FD Disclosure.

On September 8, 2023, the board of directors of InPoint Commercial Real Estate Income, Inc. (the “Company”) issued a response to an unsolicited mini-tender offer from SCM Special Fund 3, LP, an unaffiliated third party, to purchase up to 200,000 shares of our Class P, A, T, D and I common stock at a price of $5.00 per share. For several reasons discussed in the response letter, the Company’s board of directors recommends that stockholders do NOT accept the offer. The response letter to stockholders will also be mailed to the Company’s stockholders.

The response letter also informs stockholders that due to the potential frequency of these mini-tender offers and the unnecessary additional costs to the Company, we will no longer mail responses to these opportunistic mini-tender offers directly to stockholders. Going forward, we will provide all mini-tender responses in a Form 8-K filing with the U.S. Securities and Exchange Commission at www.sec.gov and on our website at https://inland-investments.com/inpoint. The company will mail a copy of the letter to a stockholder upon request.

The response letter is attached to this Form 8-K as Exhibit 99.1 and incorporated in its entirety into this Item 7.01.

The information in this report, including Exhibit 99.1, is being furnished pursuant to Item 7.01 of Form 8-K and 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 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.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.
Exhibit No.	Description
99.1	InPoint Commercial Real Estate Income, Inc. Response Letter dated September 8, 2023
104	Cover Page Interactive Data File (embedded within the Inline XBRL document).

 

 

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SIGNATURE

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

			INPOINT COMMERCIAL REAL ESTATE INCOME, INC.
Date:	September 8, 2023	By:	/s/ Cathleen M. Hrtanek
			Cathleen M. Hrtanek Secretary

 

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Exhibit 99.1

 

 

the BOARD UNANIMOUSLY RECOMMENDS

THAT YOU do not sell (TENDER) your shares to MACKENZIE

If you are considering selling your shares to Mackenzie, please read all the information below

 

September 8, 2023

Dear InPoint Commercial Real Estate Income Stockholder,

I am writing to you on behalf of the board of directors (the “Board”) of InPoint Commercial Real Estate Income, Inc. (“InPoint”) to notify you about an unsolicited third-party mini-tender offer (the “MacKenzie Offer”) being made for your shares of InPoint Class P, A, T, D and I common stock by SCM Special Fund 3, LP, an affiliate of Mackenzie Capital Management, LP (“MacKenzie”), in what we believe is an opportunistic attempt to purchase your shares. MacKenzie is offering to purchase up to an aggregate of 200,000 shares of InPoint’s common stock at a low price of $5.00 per share (the “Shares”). This is not an offer from InPoint.

InPoint is required by applicable Securities and Exchange Commission (“SEC”) rules and regulations to inform you of its position, if any, with respect to the MacKenzie Offer. In evaluating the MacKenzie Offer, the Board considered, among other things, the following factors:

(i)	The MacKenzie Offer price of $5.00 per share is approximately 71% lower than the InPoint’s most recent estimated net asset values (“NAV”) of Class P, A, T, D and I common stock of ($17.38, $17.43, $17.48, $17.42 and $17.42 per share, respectively) as of July 31, 2023.1
(ii)	The MacKenzie Offer represents an opportunistic attempt by MacKenzie to purchase the Shares and make a large profit, by buying your shares at a deeply discounted price relative to the most recent NAV thereby depriving you of the potential opportunity to realize the full, long-term value of your investment in InPoint.
(iii)	Interestingly, Mackenzie purchased its current shares of InPoint common stock at a price substantially higher than the offer price.

After carefully evaluating the MacKenzie Offer and consulting with InPoint’s management and such advisors as deemed appropriate by the Board, the Board recommenDS THAT YOU DO NOT SELL (tender) YOUR SHARES TO MACKENZIE.

Please note that stockholders who tender their shares will lose their right to receive any future distributions that are paid after the conclusion of the MacKenzie Offer. InPoint currently pays distributions at an annualized rate of $1.25 per share. While there are no guarantees of future distributions or liquidity and there can be no certainty regarding the long-term value of InPoint’s common stock because the value is dependent on a number of factors, stockholders who tender their shares pursuant to the MacKenzie Offer would give up their rights to any future distributions after the conclusion of the MacKenzie Offer as well as their rights to receive any proceeds in the future.

As stated by MacKenzie, the MacKenzie Offer is being made “for investment purposes and with the intention of making a profit from the ownership of the Shares.” MacKenzie determined the MacKenzie Offer price pursuant to its own analysis and states that [they] “have not made an independent appraisal of the Shares or [InPoint’s] properties and are not qualified to appraise real estate.” Hence, MacKenzie acknowledges that its offer price was established based on MacKenzie’s own analysis and objectives without consideration of your financial objectives.

We urge you to consult your financial advisor and exercise caution with respect to this and other mini-tender offers. The SEC has cautioned investors about these kinds of offers in an investor alert, as they are often made in an attempt to profit at investors’ expense. The SEC noted that these offers “have been increasingly used to catch investors off guard,” and cautioned that investors need to scrutinize these types of offers carefully. To read more about the risks of “mini-tender” offers, please review the alert at www.sec.gov/investor/pubs/minitend.htm.

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SEC rules permit third parties, such as MacKenzie, to distribute unsolicited mini-tender offers to stockholders of public companies. However, in order to maintain the confidentiality of our stockholders, InPoint has only provided stockholder mailing information needed to distribute the MacKenzie Offer materials to a third-party financial printer that is unaffiliated with MacKenzie. Therefore, MacKenzie will not have access to any additional stockholder information unless the stockholder agrees to accept the tender offer by MacKenzie. None of InPoint’s directors or executive officers intends to tender any shares in the MacKenzie Offer.

While the Board recommends that you do not sell your shares to Mackenzie, the Board is aware that in light of the current suspension of the share repurchase plan that some stockholders may need near-term liquidity. The Board understands that you must make your own independent decision whether to tender or refrain from tendering your shares. We strongly urge you to carefully consider all aspects of the MacKenzie Offer in light of your own circumstances, including (i) your investment objectives, (ii) your financial circumstances, including your tolerance for risk and need for immediate liquidity that cannot be satisfied by other means, (iii) other financial opportunities available to you, (iv) your own tax position and tax consequences, and (v) other factors you determine are relevant to your decision. You should carefully review all of the MacKenzie Offer documents sent to you by MacKenzie, as well as InPoint’s publicly available annual, quarterly and other reports filed with the SEC at www.sec.gov, and consult with your own financial, tax and other advisors in evaluating the MacKenzie Offer before deciding whether to tender your shares.

PLEASE CONSULT WITH YOUR FINANCIAL ADVISOR AND TAX ADVISOR ABOUT THE IMPACT OF A SALE ON YOUR OWN PARTICULAR SITUATION.

If you have any questions or need further information about your options, please feel free to contact our Investor Services team at 800-826-8228.

 

If you do not wish to tender your shares, simply IGNORE the MacKenzie Offer materials and DO NOT RESPOND.

We appreciate your trust in InPoint and the Board and thank you for your continued support.

Sincerely,

 

Mitchell A. Sabshon
President and Chief Executive Officer

 

*Please note that due to the potential frequency of these tender offers, and to save unnecessary additional costs to the Company, we will no longer mail our responses to these opportunistic mini-tender offers to you directly. Going forward, we will only provide our responses in a filing with the SEC at www.sec.gov and on our website at https://inland-investments.com/inpoint. If you receive one of these tender offers in the future, please go to these websites to review the Board’s response. You may also request a printed copy by calling your financial advisor or our Investor Services team at 800-826-8228.

1 For more information on the most recent estimated NAV, including the assumptions, estimates and judgments used to determine the estimated NAV, see InPoint’s Current Report on Form 8-K filed with the SEC on August 15, 2023.

 

Cautionary Note Regarding Forward-Looking Statements

Certain statements contained in this letter other than historical facts may be considered 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. These forward-looking statements are predictions and generally can be identified by use of statements that include phrases such as “believe,” “expect,” “anticipate,” “estimate,” “intend,” “plan,” “foresee,” “looking ahead,” “is confident,” “should,” “will,” “predicted,” “likely” or other words or phrases of similar import. Similarly, statements that describe or contain information related to matters such as InPoint’s intent, belief or expectation with respect to its financial performance, investment strategy and portfolio, cash flows, growth prospects, valuation estimates, potential listing of shares and public offering or other liquidity options and distribution rates and amounts are forward-looking statements. These forward-looking statements often reflect a number of assumptions and involve known and unknown risks, uncertainties and other factors that could cause InPoint’s actual results to differ materially from those currently anticipated in these forward-looking statements. Certain factors that could cause actual results to differ materially from these forward-looking statements are listed from time to time in InPoint’s SEC reports, including, but not limited to, the risk factors provided in InPoint’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q.

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v3.23.2

Document And Entity Information	Sep. 08, 2023
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Sep. 08, 2023
Entity Registrant Name	InPoint Commercial Real Estate Income, Inc.
Entity Central Index Key	0001690012
Entity Emerging Growth Company	true
Securities Act File Number	001-40833
Entity Incorporation, State or Country Code	MD
Entity Tax Identification Number	32-0506267
Entity Address, Address Line One	2901 Butterfield Road
Entity Address, City or Town	Oak Brook
Entity Address, State or Province	IL
Entity Address, Postal Zip Code	60523
City Area Code	(800)
Local Phone Number	826-8228
Entity Information, Former Legal or Registered Name	N/A
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity Ex Transition Period	true
Title of 12(b) Security	6.75% Series A Cumulative Redeemable Preferred Stock, par value $0.001 per share
Trading Symbol	ICR PR A
Security Exchange Name	NYSE

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