Item 8.01 Other Events.
Developments Relating to Our First Quarter Redemptions
Under the Class E share redemption program (the "Class E SRP") of Dividend
Capital Diversified Property Fund, Inc. (the "Company," "we," "our" or "us")
that is currently in effect, funds for redemptions made at the end of each
quarter are generally limited to an amount equal to (i) funds received from the
sale of Class E shares under our distribution reinvestment plan during such
calendar quarter, plus (ii) 50% of the difference between (a) the proceeds (net
of sales commissions) received by us from the sale of Class A, Class W and Class
I shares in our public primary offering and under our distribution reinvestment
plan during the most recently completed calendar quarter, and (b) the dollar
amount used to redeem Class A, Class W and Class I shares during the most
recently completed calendar quarter pursuant to the Class A, W and I share
redemption program, less (iii) funds used for redemptions of Class E shares in
the most recently completed quarter in excess of such quarter's applicable
redemption cap due to qualifying death or disability requests of stockholders
during such calendar quarter. However, our board of directors may from time to
time, but is not obligated to, authorize funds for redemptions of Class E shares
in greater or lower amounts. The foregoing limitation is referred to as the
"Quarterly Redemption Cap." Notwithstanding the Class E liquidity level desired
by our board of directors, pursuant to the Class E SRP, we will not redeem
during any consecutive 12-month period more than five percent of the number of
Class E shares of common stock outstanding at the beginning of such 12-month
period (excluding certain redemptions made in connection with a stockholder's
death or disability) (referred to herein as the "Aggregate Redemption Cap").
On June 9, 2014, our board of directors approved an increase in the Quarterly
Redemption Cap for the second quarter of 2014 to the maximum possible amount of
redemptions without exceeding the Aggregate Redemption Cap. Despite this
increase in the Quarterly Redemption Cap for the second quarter of 2014, we are
not obligated to redeem shares of our common stock under the Class E SRP.
This increased Quarterly Redemption Cap applicable to redemption requests in the
second quarter of 2014 is expected to be approximately $31.9 million (the
"Second Quarter Redemption Cap"), which includes the additional amount the board
of directors intends to make available. In addition, we expect to redeem 100% of
the qualifying redemption requests made in connection with a stockholder's death
or disability. Through June 15, 2014 (the "Deadline"), the last day for second
quarter 2014 redemption requests to be submitted under the Class E SRP, we had
received requests to redeem approximately 18.0 million shares of common stock
(the "Total Second Quarter Redemption Requests"), approximately 561,000 of which
are for qualifying death and disability redemption requests. Based on
application of the Second Quarter Redemption Cap, we expect that requesting
stockholders whose requests were received on or before the Deadline will be
redeemed pro rata.
Based on the June 24, 2014 NAV of $6.97 per Class E share, we expect to redeem,
for the second quarter of 2014, approximately 29% of the Class E shares
requested to be redeemed on or before the Deadline, including all shares
requested pursuant to qualifying death and disability requests. We expect that
Class E shares requested to be redeemed on or before the Deadline pursuant to
requests other than qualifying death and disability requests will be satisfied
on a pro rata basis and that approximately 26% of such shares (the "Pro Rata
Percentage") will be redeemed. The actual Pro Rata Percentage of redemptions
will be determined, in part, based on the NAV per share on June 30, 2014
pursuant to the terms of the Class E SRP. A copy of the Class E SRP was mailed
to stockholders, was included as an exhibit to our Current Report on Form 8-K
filed with the Securities and Exchange Commission on July 12, 2012, and is also
available on our web site at www.dividendcapitaldiversified.com. In accordance
with the Class E SRP, any portion of a redemption request of a stockholder that
is not honored will be deemed automatically withdrawn, and any such stockholder
may resubmit a request in a subsequent quarter (subject to the applicable
Quarterly Redemption Cap and all other terms and conditions of the Class E SRP).
We will not retain redemption requests that are not honored.
The Second Quarter Redemption Cap, Total Second Quarter Redemption Requests and
Pro Rata Percentage are preliminary figures that are subject to change. Pursuant
to the terms of the Class E SRP, stockholders who submitted timely redemption
requests may withdraw their requests, in whole or in part, by submitting a
written request that we receive on or before June 30, 2014. In addition, any
who has requested redemption and is a participant in our distribution
reinvestment plan will remain a participant in the distribution reinvestment
plan unless we receive written notice terminating the stockholder's
participation in accordance with the distribution reinvestment plan. Any
stockholder that wishes to withdraw a redemption request or terminate their
participation in the distribution reinvestment plan should submit the same in
Dividend Capital Diversified Property Fund Inc.
c/o DST Systems, Inc.
430 West 7th Street, Suite 219079
Kansas City, MO 64105.
This current report includes "forward-looking statements" regarding redemptions
under the Company's Class E SRP
. These statements are based on certain
assumptions and analyses made by the Company in light of the Company's
experience and the Company's perception of current conditions, expected future
developments and other factors the Company believes are appropriate. Such
statements are subject to a number of assumptions, risks and uncertainties.
Readers are cautioned not to place undue reliance on these forward-looking
statements. Among the factors that may cause the Second Quarter Redemption Cap,
Total Second Quarter Redemption Requests and Pro Rata Percentage to vary are
future sales and redemptions of the Company's shares of common stock and whether
the Company's board of directors authorizes funds for redemptions of Class E
shares in greater or lower amounts than the standard Quarterly Redemption Cap.
Except as required by applicable securities laws, the Company undertakes no
obligation to publicly update or revise any forward-looking statements, whether
as a result of future events, new information or otherwise.