PREMIUM PROPERTIES LIMITED - Declaration of special distribution to Premium linked unitholders

Release Date: 08/08/2014 15:00
Code(s): PMM
 
Wrap Text
Declaration of special distribution to Premium linked unitholders

Premium Properties Limited
(Incorporated in the Republic of South Africa)
(Registration number 1994/003601/06)
Share Code: PMM
ISIN Code: ZAE000009254
(“Premium”)
REIT status approved


Declaration of special distribution to Premium linked unitholders (“Linked Unitholders”)


1.     Introduction
       The directors of Premium have resolved to declare a distribution of the distributable earnings of
       Premium for the six month period commencing 1 March 2014 and ending 31 August 2014 (“the
       Special Distribution”) to Linked Unitholders that are recorded as such on Friday 29, August 2014,
       pursuant to the proposed acquisition by Octodec Investments Limited of the entire issued linked
       unit capital of Premium that it does not already own (“the Proposed Transaction”). The Proposed
       Transaction was approved by Linked Unitholders on Thursday, 31 July 2014.


       The Special Distribution is estimated to be 80.7 cents per Premium linked unit (Dividend No. 41)
       based on the forecast distributable earnings of Premium for the six month period commencing 1
       March 2014 and ending 31 August 2014. The final amount of the Special Distribution will be based
       on the reviewed financial statements of Premium for the six months ending 31 August 2014 and
       will be announced on the Stock Exchange News Service of the JSE Limited (“SENS”) on 28 October
       2014. The salient dates relating to the Special Distribution are detailed in paragraph 2 below.


2.     Salient dates
        Last date to trade "cum" Special Distribution                              Friday, 22 August 2014
        Commence trading "ex" Special Distribution                                 Monday, 25 August 2014
        Record date                                                                Friday, 29 August 2014
        Finalisation date                                                        Tuesday, 28 October 2014
        Payment date                                                             Monday, 17 November 2014

        Note:

        1. All dates and times indicated are South African dates and times.

        2. These dates and times are subject to amendment. Any such amendment will be released on
           SENS.
        3. Linked Unit certificates may not be dematerialised or rematerialised between Monday, 25
           August 2014 and Friday, 29 August 2014, both dates inclusive.

3.   Tax implications
     As Premium is a REIT, Linked Unitholders are advised that the Special Distribution meets the
     requirements of a "qualifying distribution" for the purposes of section 25BB of the Income Tax Act,
     No. 58 of 1962 ("Income Tax Act"). The Special Distribution to Linked Unitholders will be deemed
     to be a dividend for South African tax purposes, in terms of section 25BB of the Income Tax Act.


     Tax implications for South African tax resident Linked Unitholders:
     The Special Distribution received by or accrued to South African tax residents must be included in
     the gross income of such Linked Unitholders and is not exempt from income tax in terms of the
     exclusion to the general dividend exemption contained in section 10(1)(k)(i)(aa) of the Income Tax
     Act, because they are dividends distributed by a REIT.
     The Special Distribution is, however, exempt from dividend withholding tax ("Dividend Tax") in the
     hands of South African tax resident Linked Unitholders provided that the South African tax resident
     Linked Unitholders have provided the following forms to their Central Securities Depository
     Participant ("CSDP") or broker, as the case may be, in respect of uncertificated linked units, or the
     transfer secretaries, in respect of certificated linked units:
     -         a declaration that the Special Distribution is exempt from Dividend Tax; and
     -         a written undertaking to inform the CSDP, broker or transfer secretaries, as the case
               may be, should the circumstances affecting the exemption change or the beneficial
               owner cease to be the beneficial owner, both in the form prescribed by the
               Commissioner for the South African Revenue Service.
     Linked Unitholders are advised to contact their CSDP or broker, as the case may be, to arrange for
     the abovementioned documents to be submitted prior to the payment of the Special Distribution.


     Tax implications for non-resident Linked Unitholders:
     The Special Distribution received by non-resident Linked Unitholders will not be taxable as income
     and instead will be treated as ordinary dividends which are exempt from income tax in terms of
     the general dividend exemption section 10(1)(k)(i) of the Income Tax Act.
     It should be noted that up to 31 December 2013, distributions received by non-residents from a
     REIT were not subject to dividend tax. With effect from 1 January 2014, any distribution received
     by a non-resident from a REIT will be subject to dividend tax at 15%, unless the rate is reduced in
     terms of any applicable agreement for the avoidance of double taxation ("DTA") between South
     Africa and the country of residence of the non-resident Linked Unitholder.
     Assuming dividend tax will be withheld at a rate of 15%, the estimated net amount due to non-
     resident Linked Unitholders is 68.595 cents per share. A reduced dividend withholding rate in
     terms of the applicable DTA may only be relied on if the non-resident Linked Unitholder has
     provided the following forms to their CSDP or broker, as the case may be, in respect of
     uncertificated linked units, or the transfer secretaries, in respect of certificated linked units:
      -           a declaration that the dividend is subject to a reduced rate as a result of the application
                  of the DTA; and
      -           a written undertaking to inform the CSDP, broker or the transfer secretaries, as the case
                  may be, should the circumstances affecting the reduced rate change or the beneficial
                  owner cease to be the beneficial owner, both in the form prescribed by the
                  Commissioner of the South African Revenue Services.
      If applicable, non-resident Linked Unitholders are advised to contact their CSDP, broker or the
      transfer secretaries, as the case may be, to arrange for the abovementioned documents to be
      submitted prior to payment of the Special Distribution, if such documents have not already been
      submitted.
      Linked Unitholders are encouraged to consult with their professional advisors should they be in
      any doubt as to the appropriate action to take.
      The number of linked units in issue at the date of this declaration is 156 773 109 and the
      company's tax reference number is 9660/013/64/1.


Pretoria
8 August 2014


Investment Bank, Corporate Advisor and Sponsor to Premium
Nedbank Capital


Legal adviser to Premium
Tugendhaft Wapnick Banchetti and Partners

Date: 08/08/2014 03:00:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
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