8-K

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 1, 2020

PACIFIC OAK STRATEGIC OPPORTUNITY REIT II, INC.

(Pacific Oak SOR II, LLC, as successor by merger to Pacific Oak Strategic Opportunity REIT II, Inc.)

(Exact Name of Registrant as Specified in Its Charter)

______________________________________________________

Maryland	000-55424	46-2822978
(State or Other Jurisdiction of Incorporation or Organization)	(Commission File Number)	I.R.S. Employer Identification No.

c/o Pacific Oak Strategic Opportunity REIT, Inc.

11766 Wilshire Blvd., Suite 1670

Los Angeles, California 90025

(Address of principal executive offices)

Registrant’s telephone number, including area code: (424) 208-8100

11150 Santa Monica Blvd., Suite 400

Los Angeles, California 90025

(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:

¨Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨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:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
None	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 ¨

If an emerging growth company, indicate by check 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. ¨

ITEM 1.02 TERMINATION OF A MATERIAL DEFINITIVE AGREEMENT

The information regarding termination of the Advisory Agreement (as defined herein) in Item 2.01 below is incorporated herein by reference.

ITEM 2.01 COMPLETION OF ACQUISITION OR DISPOSITION OF ASSETS

Completion of Merger

As disclosed in the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission (“SEC”) on February 20, 2020, Pacific Oak Strategic Opportunity REIT II, Inc. (the “Company” or “POSOR II”), Pacific Oak Strategic Opportunity REIT, Inc. (“POSOR I”), and Pacific Oak SOR II, LLC, an indirect subsidiary of POSOR I (“Merger Sub”), entered into an Agreement and Plan of Merger on February 19, 2020 (the “Merger Agreement”).

As described under Item 5.07 below, on October 1, 2020, the Company’s stockholders approved the Merger (as defined herein) contemplated by the Merger Agreement at the Special Meeting (as defined below).

On October 5, 2020, the Company merged with and into Merger Sub, with Merger Sub surviving as an indirect subsidiary of POSOR I (the “Merger”). At such time, in accordance with the applicable provisions of the Maryland General Corporation Law and the Maryland Limited Liability Company Act, the separate existence of the Company ceased.

At the effective time of the Merger, each issued and outstanding share of the Company’s common stock (or a fraction thereof), $0.01 par value per share (the “POSOR II Common Stock”), converted into 0.9643 shares of POSOR I’s common stock, $0.01 par value per share (the “POSOR I Common Stock”).

The combined company after the Merger retains the name “Pacific Oak Strategic Opportunity REIT, Inc.” The Merger is intended to qualify as a “reorganization” under, and within the meaning of, Section 368(a) of the Internal Revenue Code of 1986, as amended.

The foregoing description of the Merger Agreement contained in this Item 2.01 does not purport to be complete and is subject to and qualified in its entirety by reference to the Merger Agreement, a copy of which is filed as Exhibit 2.1 to this Current Report on Form 8-K and incorporated herein by reference.

Termination of Advisory Agreement

As disclosed in the Company’s Current Report on Form 8-K filed with the SEC on February 20, 2020, concurrently with the entry into the Merger Agreement, POSOR II and its external advisor, Pacific Oak Capital Advisors, LLC (the “Advisor”) entered into a termination letter agreement (the “Termination Agreement”). Pursuant to the Termination Agreement, the advisory agreement between POSOR II and the Advisor (the “POSOR II Advisory Agreement”) was terminated at the effective time of the Merger.

The foregoing description of the Termination Agreement is only a summary, does not purport to be complete and is qualified in its entirety by reference to the full text of the Termination Agreement, a copy of which is filed as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.

ITEM 3.03 MATERIAL MODIFICATION TO RIGHTS OF SECURITY HOLDERS

As a result of and at the effective time of the Merger, holders of POSOR II Common Stock immediately prior to such time ceased having any rights as stockholders of the Company (other than their right to receive 0.9643 shares of POSOR I Common Stock per share under the Merger Agreement).

The information set forth in Item 2.01 is incorporated herein by reference.

ITEM 5.01 CHANGES IN CONTROL OF REGISTRANT

As a result of and at the effective time of the Merger, a change in control of the Company occurred and the Company merged with and into Merger Sub and the separate corporate existence of the Company ceased.

The information set forth in Item 2.01 is incorporated herein by reference.

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ITEM 5.02 DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS; COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS

As a result of the Merger and pursuant to the Merger Agreement, as described in Item 2.01 of this Current Report on Form 8-K, the Company ceased to exist and Merger Sub continued as the surviving corporation. All members of the board of directors of the Company ceased to be directors at the effective time of the Merger by operation of the Merger. The departure of the directors was in connection with the Merger and was not due to any disagreement or dispute with the Company on any matter.

ITEM 5.03 AMENDMENTS TO ARTICLES OF INCORPORATION OR BYLAWS; CHANGE IN FISCAL YEAR

On October 1, 2020, at the Special Meeting (as defined below), the Company’s stockholders approved Articles of Amendment to the charter of the Company (the “Articles of Amendment”) to remove certain provisions related “Roll-Up Transactions” (and the associated definitions) from the Company’s charter. For a further description of the Articles of Amendment, please refer to the definitive proxy statement/prospectus filed by the Company with the SEC on July 20, 2020.

On October 2, 2020, the Company filed the Articles of Amendment with the State Department of Assessments and Taxation of Maryland, and the Articles of Amendment became effective upon filing. A copy of the Articles of Amendment is included as Exhibit 3.1 hereto and is incorporated herein by reference.

ITEM 5.07 SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

On October 1, 2020, the Company held a special meeting of its stockholders (the “Special Meeting”), at which its stockholders were asked to consider and vote on (i) a proposal to approve the Merger (the “Merger Proposal”), (ii) a proposal to approve the amendment of the charter of the Company to remove the provisions related to “Roll-Up Transactions” in connection with the Merger (the “Charter Amendment Proposal”), and (iii) a proposal to adjourn the Special Meeting to solicit additional proxies in favor of the Merger Proposal and/or the Charter Amendment Proposal if there are not sufficient votes to approve the Merger Proposal and/or the Charter Amendment Proposal, if necessary and as determined by the chair of the Special Meeting (the “Adjournment Proposal”).

The Company previously filed with the SEC a definitive proxy statement/prospectus and related materials pertaining to the Special Meeting, which describe in detail each of the proposals submitted to the Company’s stockholders to be voted on at the Special Meeting.

At the Special Meeting, there were present, in person or by proxy, stockholders holding an aggregate of approximately 17,198,259 shares of the Company’s common stock, representing approximately 57.2% of the total number of 30,063,749 shares of the Company’s common stock issued and outstanding as of July 14, 2020, the record date for the Special Meeting, and entitled to vote at the Special Meeting.

The final results of the following matters voted on at the Special Meeting are set forth below.

	For	Against	Abstain
Merger Proposal (1)	15,386,782	708,578	792,369
Charter Amendment Proposal	15,527,995	768,271	901,993
Adjournment Proposal	15,525,029	829,921	843,309

^{(1 )} 310,530 shares owned by Willowbrook Capital Group LLC, an entity owned and controlled by Keith D. Hall and Peter McMillan III, were counted as present at the meeting but did not vote on the Merger Proposal.

Accordingly, the Company’s stockholders approved the Merger Proposal, the Charter Amendment Proposal and the Adjournment Proposal.

ITEM 7.01 REGULATION FD DISCLOSURE

On October 5, 2020, POSOR I issued a press release announcing the closing of the Merger. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein solely for purposes of this Item 7.01 disclosure.

Pursuant to the rules and regulations of the SEC, the information in this Item 7.01 disclosure, including Exhibit 99.1 and information set forth therein, is deemed to have been furnished and shall not be deemed to be “filed” under the Securities Exchange Act of 1934.

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ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS

(d)	Exhibits
Ex.	Description
2.1	Agreement and Plan of Merger, dated as of February 19, 2020, by and among Pacific Oak Strategic Opportunity REIT, Inc., Pacific Oak SOR II, LLC and Pacific Oak Strategic Opportunity REIT II, Inc. (incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K filed February 20, 2020)
3.1	Articles of Amendment*
10.1	Termination Agreement, dated as of February 19, 2020, by and among Pacific Oak Strategic Opportunity REIT II, Inc. and Pacific Oak Capital Advisors, LLC (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed February 20, 2020)
99.1	Press Release*

* Filed herewith

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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.

	PACIFIC OAK SOR II, LLC (as successor by merger to Pacific Oak Strategic Opportunity REIT II, Inc.)
	By:PACIFIC OAK SOR II HOLDINGS, LLC, a Maryland limited liability company, its sole member
	By: PACIFIC OAK SOR PROPERTIES LLC, a Delaware limited liability company, its sole member
	By:PACIFIC OAK SOR (BVI) HOLDINGS, LTD., a British Virgin Islands company limited by shares, its sole member
	By:PACIFIC OAK STRATEGIC OPPORTUNITY LIMITED PARTNERSHIP, a Delaware limited partnership, its sole shareholder
	By:PACIFIC OAK STRATEGIC OPPORTUNITY REIT, INC., a Maryland corporation, its sole general partner
Dated: October 5, 2020	BY:	/s/ Michael A. Bender
		Michael A. Bender
		Chief Financial Officer, Treasurer and Secretary

EX-3.1

Exhibit 3.1

PACIFIC OAK STRATEGIC OPPORTUNITY REIT II, INC.

ARTICLES OF AMENDMENT

Pacific Oak Strategic Opportunity REIT II, Inc., a Maryland corporation (the “Corporation”), hereby certifies to the State Department of Assessments and Taxation of Maryland that:

FIRST: The charter of the Corporation (the “Charter”) is hereby amended by deleting the definitions of “Roll-Up Entity” and “Roll-Up Transaction” in Article IV of the Charter in their entirety.

SECOND: The Charter is hereby further amended by deleting the existing Section 9.14 (“Limitations on Roll-Up Transactions”) of the Charter in its entirety and renumbering Section 9.15 (“Limitations on Underwriting”) as Section 9.14.

THIRD: The foregoing amendments have been duly advised by the Board of Directors of the Corporation and approved by the stockholders of the Corporation as required by law.

FOURTH: The undersigned acknowledges these Articles of Amendment to be the corporate act of the Corporation and as to all matters or facts required to be verified under oath, the undersigned acknowledges that to the best of his knowledge, information and belief, these matters and facts are true in all material respects and that this statement is made under the penalties for perjury.

- signature page follows -

IN WITNESS WHEREOF, the Corporation has caused these Articles of Amendment to be executed in its name and on its behalf by its Chief Executive Officer and attested to by its Executive Vice President, Chief Financial Officer, Treasurer and Secretary on this 2nd day of October, 2020.

ATTEST:		PACIFIC OAK STRATEGIC OPPORTUNITY REIT II, INC.
By:	/s/ Michael A. Bender	By:	/s/ Keith D. Hall
	Name: Michael A. Bender		Name: Keith D. Hall
	Title: Executive Vice President, Chief Financial Officer, Treasurer and Secretary		Title: Chief Executive Officer

EX-99.1

Exhibit 99.1

Contact:    Damon Elder                        FOR IMMEDIATE RELEASE

Spotlight Marketing Communications

(949) 427-1377

damon@spotlightmarcom.com

Pacific Oak Strategic Opportunity REIT and Pacific Oak Strategic Opportunity REIT II Complete Merger to Form $2 Billion Company⁽¹⁾

LOS ANGELES (October 5, 2020)— Pacific Oak Strategic Opportunity REIT, Inc. announced today the completion of its previously announced merger with Pacific Oak Strategic Opportunity REIT II, Inc. in a stock-for-stock transaction, creating a combined company with in excess of $2 billion¹ in gross real estate and real estate-related assets. The combined company has retained the name “Pacific Oak Strategic Opportunity REIT, Inc.” and the merger is expected to qualify as a tax-free reorganization.

“We appreciate the trust and confidence of our stockholders and thank them for their support and votes in favor of the merger,” said Keith D. Hall, Chief Executive Officer and a director of Pacific Oak Strategic Opportunity REIT. “We believe the merger creates a stronger and more robust company, and provides significant benefits to stockholders, including improved access to capital markets and reduced operating costs.”

Under the terms of the merger, in exchange for each share of common stock owned, Pacific Oak Strategic Opportunity REIT II stockholders received 0.9643 shares of the combined company’s common stock. Pacific Oak Strategic Opportunity REIT stockholders prior to the merger own approximately 69%, and former Pacific Oak Strategic Opportunity REIT II stockholders own approximately 31%, of the combined company, on a fully diluted basis.

Management believes the merger delivers enhanced value to all stockholders and allows each company’s stockholders to participate in a larger, stronger and more diversified combined company. Several stockholder benefits are expected, including;

•the combined company’s portfolio is more diversified with respect to tenants, asset type and geographic location than the individual portfolios on a stand-alone basis;

•the combined balance sheet has increased equity and liquidity as compared to the individual companies on a stand-alone basis;

•the combined company benefits from the elimination of duplicative overhead costs and the creation of a more streamlined and efficient business structure; and

•the enhanced size, scale and financials of the combined company may improve access to capital markets and reduce the cost of capital, which may be used to support strategic investments to drive growth opportunities.

-more-

The merger agreement was negotiated on behalf of the stockholders by their respective special committees, each of which was composed exclusively of independent directors from each of the boards of directors. Each special committee was advised by separate independent financial and legal advisors. The board of directors of Pacific Oak Strategic Opportunity REIT and the board of directors of Pacific Oak Strategic Opportunity REIT II each unanimously approved the merger.

Advisors

Houlihan Lokey acted as financial advisor to Pacific Oak Strategic Opportunity REIT’s special committee of the board of directors and SunTrust Robinson Humphrey, Inc. acted as financial advisor to Pacific Oak Strategic Opportunity REIT II’s special committee of the board of directors. Morrison & Foerster LLP acted as legal counsel to Pacific Oak Strategic Opportunity REIT’s special committee of the board of directors, Rogers & Hardin LLP acted as legal counsel to Pacific Oak Strategic Opportunity REIT II’s special committee of the board of directors and DLA Piper LLP (US) acted as legal counsel to Pacific Oak Strategic Opportunity REIT.

About Pacific Oak Strategic Opportunity REIT, Inc.

Pacific Oak Strategic Opportunity REIT, Inc. is a public, non-traded corporation headquartered in Los Angeles, California, that has elected to be taxed and currently qualifies as real estate investment trust and invests in opportunistic real estate and other real estate-related investments. The company manages a portfolio valued in excess of $2 billion⁽¹⁾, comprised of nine office properties, one office portfolio consisting of four office buildings with approximately 3.8 million rentable square feet and 14 acres of undeveloped land, two hotel properties, two apartment properties, one residential home portfolio consisting of 1,760 single-family rental homes, three investments in undeveloped land with approximately 1,000 developable acres, an investment in an office/retail property redevelopment, six investments in unconsolidated entities and three investments in real estate equity securities as of October 5, 2020.

¹ This is the estimated value reflected in the December 2019 estimated net asset value (“NAV”) and acquisition price for acquisitions subsequent to the December 2019 NAV valuation date for real estate and investments in unconsolidated joint ventures, plus the value as of June 30, 2020 for equity securities, for investments in the portfolio as of June 30, 2020.  Value has been adjusted for the company’s share of consolidated and unconsolidated joint ventures. For more information, see each company’s respective Current Report on Form 8-K filed with the U.S. Securities and Exchange Commission (the “SEC”) on December 19, 2019.

Forward-Looking Statements

This communication contains statements that constitute “forward-looking statements,” as such term is defined in Section 27A of the Securities Act 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; Pacific Oak Strategic Opportunity REIT cannot give any assurance that its expectations will be attained. Factors that could cause actual results to differ materially from Pacific Oak Strategic Opportunity REIT’s expectations include, but are not limited to, availability of suitable investment opportunities; changes in interest rates; the availability and terms of financing; general economic conditions; market conditions; legislative and regulatory changes that could adversely affect the business of Pacific Oak Strategic Opportunity REIT; and other factors, including those set forth in the Risk Factors section of Pacific Oak Strategic Opportunity REIT’s most recent Annual Report on Form 10-K filed with the SEC, and other reports filed by Pacific Oak Strategic Opportunity REIT with the SEC, copies of which are available on the SEC’s website, www.sec.gov. Pacific Oak Strategic Opportunity REIT undertakes no obligation to update these statements for revisions or changes after the date of this communication, except as required by law.