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DELTA PROPERTY FUND LIMITED - Finalisation announcement for the Dividend Reinvestment Alternative

Release Date: 20/11/2018 11:15
Code(s): DLT     PDF:  
 
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Finalisation announcement for the Dividend Reinvestment Alternative

Delta Property Fund Limited
(Incorporated in the Republic of South Africa)
(Registration number 2002/005129/06)
Share code: DLT ISIN: ZAE000194049
(“Delta” or the “Company”)
REIT status approved

Finalisation announcement for the Dividend Reinvestment Alternative

Shareholders are referred to Delta’s unaudited condensed consolidated interim results for the six months
ended 31 August 2018 released on SENS on Monday, 5 November 2018 (the “Results Announcement”)
which included reference to a cash dividend in the amount of 39.39818 cents per Delta share (the “Cash
Dividend”) with the election to reinvest the Cash Dividend in return for Delta shares (the “Dividend
Reinvestment Alternative”). Full details of the Dividend Reinvestment Alternative were also set out in a
circular posted to shareholders on Wednesday, 7 November 2018 (the “Circular”).

The price applicable to a Delta shareholder electing the Dividend Reinvestment Alternative is R5.82689 (the
“Reinvestment Price”), being the five-day volume weighted average traded price (“VWAP”) (cum dividend)
of Delta shares on the JSE prior to the finalisation date of 20 November 2018.

The ratio in respect of the Dividend Reinvestment Alternative is 6.76145 Delta shares for every 100 Delta
shares held on the record date by South African resident shareholders exempt from dividend withholding
tax (“Dividend Tax”) and 5.40916 Delta shares for every 100 Delta shares held on the record date by non-
resident shareholders subject to Dividend Tax at 20%.

1. Dividend Tax implications

    Dividend Tax implications for South African resident shareholders

    Dividends received by or accrued to South African tax residents must be included in the gross income of
    such shareholders and will not be 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. These dividends are however exempt from Dividend Tax in the hands of
    South African resident shareholders provided that the South African resident shareholders have
    provided to the CSDP or broker, as the case may be, in respect of uncertificated shares, or the transfer
    secretaries in respect of certificated shares:

    -    a declaration that the distribution is exempt from Dividends Tax; and
    -    a written undertaking to inform the CSDP, broker or the transfer secretaries, as the case may be,
         should the circumstances affecting the exemption change or the beneficial owner ceases to be
         the beneficial owner,

    both in the form prescribed by the Commissioner for the South African Revenue Service. If resident
    shareholders have not submitted the abovementioned documentation to confirm their status as a
    South African resident, they are advised to contact their CSDP or broker, as the case may be, to arrange
    for the documents to be submitted prior to the payment of the dividend.

    Dividend Tax implication for non-resident shareholders

    Dividends received by non-resident shareholders from a REIT will not be taxable as income and will be
    exempt from income tax in terms of the exemption in section (10)(1)(k)(i) of the Income Tax Act. Any
    dividend received by a non-resident from a REIT is subject to Dividend 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 non-resident shareholders. Assuming Dividend Tax will
    be withheld at the current rate of 20%, the net dividend amount due to non-resident shareholders is
    31.51854 cents per share. A reduced Dividend 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 uncertificated shares, or the transfer secretaries, in respect of
    certificated shares:

    -      a declaration that the dividend is subject to a reduced rate as a result of the application of a DTA;
           and
    -      a written undertaking to inform the CSDP, broker or the transfer secretary, 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. If applicable,
   non-resident shareholders are advised to contact their CSDP, broker or the transfer secretary, as the
   case may be, to arrange for the abovementioned documents to be submitted prior to the payment of
   the dividend if such documents have not already been submitted.

   Shareholders are encouraged to consult their professional advisors should they be in any doubt as to
   the appropriate action to take.

2. Fractions

   Trading in the Strate environment does not permit fractions or fractional entitlements. Accordingly,
   where a shareholder’s entitlement to the Delta shares in relation to the Dividend Reinvestment
   Alternative calculated in accordance with the ratio above gives rise to a fraction of a new Delta share,
   such fraction will be rounded down to the nearest whole number and the cash balance will be paid to
   the shareholder.

3. Impact on Delta shareholders

   An example illustrating the impact for South African resident shareholders and non-resident
   shareholders electing to either receive the Cash Dividend or the Dividend Reinvestment Alternative and
   applying the rounding principle set out in paragraph 2 above are as follows:


                                                        South African resident             Non-resident
                                                           shareholders exempt     shareholders subject
                                                             from Dividend Tax          to Dividend Tax
        Cash Dividend
        Dividend per share (cents)                                    39.39818                 39.39818
        Dividend Tax of 20% per share (cents)                                0                (7.87964)
        Net dividend per share (cents)                                39.39818                 31.51854
        Dividend Reinvestment Alternative
        Number of shares held                                              100                      100
        Reinvestment price (R)                                         5.82689                  5.82689
        Total amount available for reinvestment                       39.39818                 31.51854
        (cents)
        Number of shares issued in terms of the                              6                        5
        Dividend Reinvestment Alternative
        Cash payment for fractional entitlement (R)                       4.44                     2.38

4. Foreign shareholders

   The right to elect the Dividend Reinvestment Alternative in jurisdictions other than the Republic of
   South Africa may be restricted by law and failure to comply with any of these restrictions may
   constitute a violation of the securities laws of any such jurisdictions. Accordingly, shareholders will not
   be entitled to receive the Dividend Reinvestment Alternative, directly or indirectly, in those
   jurisdictions and shall be deemed to have elected the Cash Dividend. More specifically, the Delta shares
   have not been and will not be registered for the purposes of the election under the securities laws of
   the United Kingdom, European Economic Area of EEA, Canada, United States of America, Japan or
   Australia and accordingly are not being offered, sold, taken up, re-sold or delivered directly or indirectly
   to recipients with registered addresses in such jurisdictions.

5. Salient dates and times

   Shareholders electing the Dividend Reinvestment Alternative should note that settlement of the Delta
   shares will occur 3 business days after the record date, which differs from the conventional one
   business day after the record date settlement process.

   Shareholders are reminded that the last day to elect to receive the Dividend Reinvestment Alternative
   is 12:00 on Friday, 7 December 2018. No action is required if you wish to receive the Cash Dividend.

   The salient dates and times for the Cash Dividend and the Dividend Reinvestment Alternative as set out
   in the results announcement and the Circular remain unchanged.

20 November 2018

Sponsor
Nedbank Corporate and Investment Banking

Date: 20/11/2018 11:15:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
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