Terms

Series

9 1/4% Series F Cumulative Redeemable Preferred Stock

Liquidation Preference

$25.00

Coupon Rate

9.25%

Rate Type

Fixed

Annual Dividend

$2.31

Payment Frequency

Monthly

Cumulative

Yes

Perpetual

Yes

Convertible

No

Callable

Yes

First Call Date

October 16, 2007

First Call Price

$25.00

Redemption Notice Period

30 days

Capital Stack Ranking

Junior To: All Existing And Future Indebtedness; Pari Passu With: 9.5% Series A Cumulative Preferred Stock, 8 7/8% Series B Cumulative Preferred Stock, 9 3/8% Series C Cumulative Redeemable Preferred Stock, 9 1/2% Series E Cumulative Preferred Stock; Senior To: Common Stock, All Equity Securities Junior To Series F

Regulatory (Basel III) Call

Yes

Tax Classification

Reit Passthrough

Qualifies for QDI

No

Qualifies for DRD

No

Shares Offered

470,000

Prospectus Summary

Mid-America Apartment Communities, Inc. (MAA), a Memphis-based REIT operating 123 apartment communities across 12 southeastern U.S. states, is offering 470,000 shares of its 9.25% Series F Cumulative Redeemable Preferred Stock at a $25 liquidation preference per share. The fixed annual dividend is $2.3125 per share, paid monthly on the 15th of each month, beginning November 15, 2002. The stock is not redeemable until October 16, 2007, at which point MAA may call shares at $25 plus accrued dividends. Crucially, dividends are cumulative — if MAA skips or defers a payment, those arrears accumulate and must be paid in full before any dividends can be paid on common or junior securities. The Series F Preferred sits above common stock and all junior equity in the capital stack, ranking pari passu with MAA's Series A (9.5%), Series B (8.875%), Series C (9.375%), and Series E (9.5%) preferred shares. It is junior to all existing and future debt, including MAA's approximately $788 million in notes payable. As a holding company REIT, substantially all assets are held through Mid-America Apartments, L.P., introducing structural subordination risk — creditors of the operating partnership have a prior claim on those assets. There is a REIT-qualification redemption provision: if any holder's ownership exceeds 9.9% of total capital stock value, the issuer can purchase those 'excess shares' at any time, including before the 2007 call date. At the $25 offering price, the effective yield is 9.25% annually, or approximately $0.1927 per share per month. Because MAA is a REIT, dividends are generally taxed as ordinary income rather than at the preferential 15%/20% qualified dividend rate (QDI), and the dividends-received deduction (DRD) for corporate holders typically does not apply. The record date for each monthly dividend is the first calendar day of the month in which the payment date falls. The dividend stopper provision blocks any distributions on common or pari passu/junior preferred stock — including redemptions — if Series F cumulative dividends are not current, providing meaningful protection to preferred holders in a stress scenario.

Summarized from the SEC prospectus filing.

Distribution History

Ranking vs. Other Preferreds

Dividend Stopper Provisions

Dividend Stopper Description

If cumulative dividends on the Series F Preferred Stock are not fully paid or set aside for all past and current periods, the issuer may not declare or pay dividends on, or redeem/repurchase, its common stock or any other junior or pari passu equity securities.

Other Preferreds from Mid-America Apartment Communities Inc

Div Score Breakdown

Reinvesty's multi-factor safety analysis for this preferred, composite score: 40 (Weak)