Terms

Series

Series D Cumulative Convertible Preferred Stock

Liquidation Preference

$25.00

Coupon Rate

8.75%

Rate Type

Fixed To Floating

Annual Dividend

$2.19

Payment Frequency

Quarterly

Cumulative

Yes

Perpetual

Yes

Convertible

Yes

Callable

Yes

First Call Date

September 21, 2021

First Call Price

$25.00

Capital Stack Ranking

Junior To: All Existing And Future Debt And Liabilities, Any Future Senior Capital Stock Expressly Designated As Senior; Pari Passu With: Series A Preferred Stock, Series B Preferred Stock, Any Other Parity Preferred Stock; Senior To: Common Stock, Any Future Junior Capital Stock

Regulatory (Basel III) Call

Yes

Tax Classification

Reit Passthrough

Qualifies for QDI

No

Qualifies for DRD

No

Shares Offered

1,600,000

Prospectus Summary

Wheeler Real Estate Investment Trust, Inc. is offering 1,600,000 shares of its Series D Cumulative Convertible Preferred Stock at a liquidation preference of $25.00 per share. The shares pay a fixed dividend of 8.75% per annum ($2.1875/share annually, $0.546875 quarterly) through September 20, 2023, after which the rate escalates by 2.0% annually to a maximum of 14%. The company may call the shares at $25.00 on or after September 21, 2021. Because dividends are cumulative, any missed payments accrue and must be paid in full before distributions can resume to common stockholders; holders cannot permanently lose the right to receive unpaid dividends simply because the board does not declare them. The Series D Preferred Stock ranks senior to Wheeler REIT's common stock and any future junior capital stock for both dividends and liquidation proceeds. It ranks on parity with the existing Series A and Series B Preferred Stock. Critically, it is subordinate to all existing and future debt obligations of the company and its subsidiaries — total long-term debt was approximately $256.7 million as of June 30, 2016. As a holding company issuer, preferred holders face structural subordination to claims at the operating partnership level. The company may redeem the preferred early (before 2021) if necessary to maintain REIT qualification or if the Asset Coverage Ratio (total assets less liabilities divided by liquidation value of redeemable preferred) falls below 200% and is not cured within 30 days after the relevant quarterly or annual filing date. At par, the initial effective yield is 8.75%, paid quarterly on January 15, April 15, July 15, and October 15 (first payment October 15, 2016). Because Wheeler REIT is a REIT, dividends generally do not qualify for the preferential 15%/20% qualified dividend income (QDI) tax rate and are not eligible for the corporate dividends-received deduction (DRD); they are typically taxable as ordinary income or return of capital. The security is unrated. If the company misses a dividend payment by more than three business days, the dividend rate increases by an additional 2.0% per annum until cured. After six consecutive missed quarterly dividends, preferred holders gain the right to elect two additional board directors, providing a limited enforcement mechanism but no guarantee of payment.

Summarized from the SEC prospectus filing.

Distribution History

Floating Rate Terms

Conversion Terms

Ranking vs. Other Preferreds

Dividend Stopper Provisions

Dividend Stopper Description

If the company fails to pay cumulative dividends on the Series D Preferred Stock for six or more consecutive quarterly periods, holders of Series D Preferred Stock (together with parity preferred) gain the right to elect two additional directors, but distributions to common stockholders are effectively blocked as the Series D ranks senior to common stock for dividend payments.

Div Score Breakdown

Reinvesty's multi-factor safety analysis for this preferred, composite score: 45 (Average)