FORTRESS REIT LIMITED - Cash payment in respect of the fractional entitlements for the in specie distribution

Cash payment in respect of the fractional entitlements for the in specie distribution

FORTRESS REIT LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2009/016487/06)
JSE share codes:       FFA ISIN: ZAE000248498
                       FFB ISIN: ZAE000248506
Bond company code: FORI
(Approved as a REIT by the JSE)
(“Fortress” or “the Company”)


CASH PAYMENT IN RESPECT OF THE FRACTIONAL ENTITLEMENTS FOR THE IN SPECIE DISTRIBUTION


Shareholders are referred to the announcements published on SENS on 5 March 2020 and 17 March 2020 in
respect of the in specie distribution of Resilient REIT Limited (“Resilient”) in the ratio of 1 Resilient share
for every 67.84 FFA shares or 1 Resilient share for every 70.40 FFB shares held at the close of trade on the
record date, being Friday, 27 March 2020.

In implementing the in specie distribution, Fortress is required by the JSE to apply the JSE’s rounding
principle. As such, if a Fortress shareholder becomes entitled to a fraction of a Resilient share arising from
the in specie distribution (“fractional entitlement”), such Resilient share will be rounded down to the
nearest whole number, resulting in the allocation of whole Resilient shares and a cash payment for the
fraction (the “fractional cash payment”).

Fortress shareholders are advised that the value of a Resilient share to be utilised in determining the
fractional cash payment due to a Fortress shareholder in respect of any fractional entitlement is R33.02296,
being the volume-weighted average traded price of Resilient shares on the JSE on Wednesday, 25 March
2020, discounted by 10%.

In addition to the tax implications on the share component of the in specie distribution, the fractional cash
payment constitutes a dividend and as such will be subject to ordinary tax for South African tax resident
shareholders. Similarly, for non-resident shareholders the fractional cash payment constitutes a dividend and
will be subject to dividend withholding tax at a rate of 20%, unless a reduced rate is applicable.

By way of example:

Assuming that a South African resident shareholder holds 1 000 FFA shares at the close of business on the
record date for the in specie distribution, being Friday, 27 March 2020, such shareholder would (but for
rounding) receive 14.7409 Resilient shares pursuant to the in specie distribution. However, applying the
rounding principle detailed above, the shareholder will receive 14 Resilient shares and receive a fractional
cash payment in respect of the fractional entitlement of R24.46671, being R33.02296 x 0.7409, (rounded to
5 decimal places).

Where a non-resident shareholder holds 1 000 FFA shares at the close of business on the record date for the
in specie distribution, being Friday, 27 March 2020, such shareholder would (but for rounding) be awarded
14.7409 Resilient shares pursuant to the in specie distribution. However, applying the rounding principle
detailed above, the shareholder will be awarded 14 Resilient shares and a fractional cash payment in respect
of the fractional entitlement of R24.46671, being R33.02296 x 0.7409 (rounded to 5 decimal places). The
total award will then be subject to dividend withholding tax at 20% (resulting in a net fractional cash
payment of R19.57337), unless the rate is reduced in terms of any applicable agreement for the avoidance of
double taxation between South Africa and the country of residence of the shareholder. Assuming a value of
R36.69217 per Resilient share and a dividend withholding tax rate of 20%, the fractional cash payment will
be R8.16067.

The salient dates and times announced on 5 March 2020 remain unchanged.

26 March 2020

Lead sponsor
Java Capital

Joint sponsor
Nedbank Corporate and Investment Banking

Date: 26-03-2020 12:55:00
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