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Dividend With Election To Reinvest: Tax Treatment And Salient Dates
FAIRVEST PROPERTY HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1998/005011/06)
Share code: FVT ISIN: ZAE000203808
(Approved as a REIT by the JSE)
(“Fairvest”)
DIVIDEND WITH ELECTION TO REINVEST: TAX TREATMENT AND SALIENT DATES
Shareholders are referred to Fairvest’s summarised consolidated results for the six months ended 31
December 2016, as published on SENS today, 2 March 2017, wherein shareholders were advised that
Fairvest’s board of directors has approved and declared an interim gross distribution of 8.953 cents per
share for the six-month period ended 31 December 2016, payable to shareholders registered as such at
the close of business on Thursday, 13 April 2017.
Shareholders will be entitled, in respect of all or part of their shareholdings, to elect to reinvest the net
cash dividend of 8.953 cents per share, in return for Fairvest ordinary shares (“Reinvestment
Alternative”), failing which they will receive the cash dividend (“Cash Dividend”). Further details
regarding the Reinvestment Alternative will be set out in a circular to shareholders, to be issued on or
about 24 March 2017.
The entitlement of shareholders to elect to participate in the Reinvestment Alternative is subject to the
board, either itself or through a board sub-committee appointed to set the pricing and terms of the
Reinvestment Alternative, having the discretion to withdraw the entitlement to elect the Reinvestment
Alternative should market conditions warrant such action. A withdrawal of the entitlement to elect the
Reinvestment Alternative would be communicated to shareholders before the publication of the
finalisation announcement on Friday, 31 March 2017.
SALIENT DATES AND TIMES
Please see below the salient dates relating to the cash dividend and Reinvestment Alternative:
SALIENT DATES AND TIMES 2017
Circular and form of election posted to Shareholders Friday, 24 March
Announcement of Reinvestment Alternative issue price, ratio and finalisation information on Friday, 31 March
SENS
Last day to trade cum Reinvestment Alternative and Cash Dividend (“LDT”) Monday, 10 April
Trading commences ex Reinvestment Alternative and Cash Dividend Tuesday, 11 April
Listing of maximum possible number of Shares to be issued under the Reinvestment Thursday, 13 April
Alternative
Last day to elect to receive Reinvestment Alternative by 12:00 (South African time) on Thursday, 13 April
Record date Thursday, 13 April
Electronic payment and CSDP/broker accounts updated in respect of Cash Dividend on or Tuesday, 18 April
about
Announcement of the results of the Reinvestment Alternative and Cash Dividend on SENS Tuesday, 18 April
Share certificates posted and CSDP/broker accounts updated in respect of Reinvestment Thursday, 20 April
Alternative on or about
Adjustment of number of new shares listed on or about Monday, 24 April
Notes: 1. Shareholders electing the Reinvestment Alternative, should note that settlement of the Shares will occur 3 business
days after the Record Date, which differs from the conventional one business day after the record date settlement
process.
2. Shares may not be dematerialised or rematerialised between Tuesday, 11 April 2017 and Thursday, 13 April 2017,
both days inclusive.
3. The above dates and times are subject to change. Any changes will be announced on SENS
TAX IMPLICATIONS
In accordance with Fairvest’s status as a REIT, shareholders are advised that the distribution meets the
requirements of a “qualifying distribution” for the purposes of section 25BB of the Income Tax Act, 58 of
1962 (“Income Tax Act”). The distribution on the shares will be deemed to be a dividend, for South African
tax purposes, in terms of section 25BB of the Income Tax Act. Accordingly, qualifying distributions received
by local tax residents must be included in the gross income of such shareholders (as a non-exempt
dividend in terms of section 10(1)(k)(aa) of the Income Tax Act), with the effect that the qualifying
distribution is taxable as income in the hands of the shareholder.
These qualifying distributions are, however, exempt from dividend withholding tax in the hands of South
African tax resident shareholders, provided that the South African resident shareholders have provided
the following forms to their Central Securities Depository Participant (“CSDP”) or broker, as the case may
be, in respect of uncertificated shares, or the transfer secretaries, in respect of certificated shares:
a) a declaration that the distribution is exempt from dividends tax; and
b) a written undertaking to inform the CSDP, broker or the transfer secretaries, as the case may be,
both in the form prescribed by the Commissioner for the South African Revenue Service. Shareholders 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 distribution, if such documents have
not already been submitted.
Qualifying distributions received by non-resident shareholders will not be taxable as income and instead
will be treated as ordinary dividends but which are exempt in terms of the usual dividend exemptions per
section 10(1)(k) of the Income Tax Act. Any qualifying distribution received by a non-resident from a REIT
will be subject to dividend withholding tax at 20%, 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 shareholder. Assuming dividend withholding tax will be withheld at a rate of 20%, the
net amount due to non-resident shareholders will be 7.16240 cents per share. A reduced dividend
withholding tax rate in terms of the applicable DTA, may only be relied on if the non-resident shareholder
has provided the following forms to their CSDP or broker, as the case may be, in respect of the
uncertificated shares, or the transfer secretaries, in respect of certificated shares:
a) a declaration that the dividend is subject to a reduced rate as a result of the application of a DTA;
and
b) a written undertaking to inform their 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 for the South African Revenue Service. Non-resident
shareholders 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 distribution if such
documents have not already been submitted, if applicable.
Local tax resident shareholders as well as non-resident shareholders are encouraged to consult their
professional advisors should they be in any doubt as to the appropriate action to take.
FURTHER IMPFORMATION
Trading in the Strate environment does not permit fractions and fractional entitlements. Where a
shareholder’s entitlement to the shares in relation to the Reinvestment Alternative, calculated in
accordance with the ratio to be announced in the finalisation announcement, gives rise to an entitlement
to a fraction of a new share, such fraction will be rounded down to the nearest whole number with the
cash balance of the dividend being paid to the shareholder.
Shares in issue at the date of declaration of the final distribution: 780 010 521
Fairvest income tax reference number: 9205/066/06/1
2 March 2017
Cape Town
Sponsor
PSG Capital Proprietary Limited
Date: 02/03/2017 08:05:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
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