Artis Real Estate Investment Trust (Artis) has announced that it will not be redeeming any of its outstanding Preferred Units, Series E, on September 30, 2023. Instead, holders of these Series E Units will have the option to reclassify them into Preferred Units, Series F, of Artis on October 2, 2023. The reclassification will be done at a ratio of one Series F Unit for each Series E Unit. This decision is in accordance with the terms specified in the Certificate of Series E Unit Terms.
For holders of Series E Units who choose not to reclassify, they will continue to receive distributions on a quarterly basis, in an annual amount determined by multiplying the annual fixed distribution rate by $25.00. The fixed distribution rate for the upcoming period commencing on October 2, 2023, is 7.198% per annum.
On the other hand, holders of Series F Units that may be issued on October 2, 2023, will receive distributions based on a floating quarterly distribution rate. This rate is calculated using the actual number of days in a quarterly floating rate period, divided by 365, multiplied by $25.00. The floating quarterly distribution rate for the initial period commencing on October 2, 2023, is 8.457% per annum.
It is important to note that holders of Series E Units are not obligated to reclassify into Series F Units. However, if Artis determines that there would be fewer than 500,000 Series E Units outstanding on October 2, 2023, all remaining Series E Units will be automatically reclassified into Series F Units on a one-for-one basis. Conversely, if Artis determines that less than 500,000 Series F Units would be issued based on holders’ elections, then reclassification will not be allowed.
As of the present date, there are a total of 3,277,110 Series E Units in circulation. Holders of Series E Units need to provide a notice of exercise of their reclassification rights to Artis by 5:00 p.m. (Toronto time) on September 18, 2023. Failure to meet this deadline will result in the reclassification not being valid.
The Series F Units will be listed on the Toronto Stock Exchange, subject to Artis fulfilling all the listing requirements. Artis is a Canadian real estate investment trust that focuses on industrial, office, and retail properties in Canada and the United States. Its goal is to enhance net asset value per unit and distributions for investors through value investing in real estate.
Source: Artis Real Estate Investment Trust