By Stephanie N. Rotondo
Portland, Ore., April 2 - Preferred Apartment Communities Inc. issued $2.16 million of preferred stock units, the company said in an 8-K filing with the Securities and Exchange Commission on Monday.
Each unit includes one 6% $1,000-par series A redeemable preferred share and one warrant for 20 shares of common stock.
The company anticipates subsequent closings on a monthly basis. It will sell a maximum of 150,000 units, or $150 million, through the continuous public offering.
Dividends of $5.00 per share on the preferreds are expected to be declared monthly. The first will be payable on May 21.
The warrants are exercisable at $9.59 per share from March 30, 2013 to March 30, 2016. The strike price is a nearly 20% premium over Monday's closing share price of $8.01 (NYSE Amex: APTS).
The company originally announced the deal in September.
As previously reported, two years after issuance, the preferreds can be put back at 90% of par plus accrued dividends. The redemption price goes up to 95% of par after three years, to 97% of par after four years and to par after five years.
The company also has the right to redeem the preferreds at par plus accrued dividends after 10 years.
The company can choose to pay any redemption in common stock.
International Assets Advisory LLC is the dealer manager.
Proceeds will be used to acquire multifamily properties.
Preferred Apartment Communities is an Atlanta-based real estate investment trust.
| Issuer: | Preferred Apartment Communities Inc.
|
| Securities: | Units of one series A redeemable preferred share and one warrant for 20 common shares
|
| Amount: | $2,155,000, or 2,155 units
|
| Dividend: | 6%, payable monthly
|
| Price: | $1,000 per preferred share
|
| Call option: | At par plus accrued dividends after 10 years
|
| Put option: | At 90% of par after two years; redemption price increases to 95% of par after three years, to 97% of par after four years and to par after five years
|
| Warrant strike price: | $9.59 per share
|
| Dealer manager: | International Assets Advisory LLC
|
| Settlement date: | March 30
|
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