Business Context and Reporting Period
This Form 8-K Current Report was filed by Wheeler Real Estate Investment Trust, Inc. (WHLR) on May 5, 2025. The filing addresses the 20th monthly "Holder Redemption Date" for the Company's Series D Cumulative Convertible Preferred Stock and the resulting adjustment to the conversion price of its 7.00% Subordinated Convertible Notes due 2031.
Key Financial Metrics and Transaction Details
- Redemption Volume: 15 redemption requests were processed, totaling 23,070 shares of Series D Preferred Stock.
- Redemption Price: Approximately $41.03 per share (comprising $25.00 principal plus accrued dividends).
- Settlement Method: The aggregate redemption price was settled via the issuance of 774,572 shares of Common Stock.
- Stock Valuation: The volume-weighted average closing price of Common Stock for the ten trading days preceding the redemption date was approximately $1.22.
- Outstanding Shares (as of May 5, 2025): 3,845,587 shares of Common Stock and 1,790,504 shares of Series D Preferred Stock.
- Cumulative Redemptions: To date, 349 requests have been processed, redeeming 1,639,903 shares of Series D Preferred Stock, settled with approximately 1,586,400 shares of Common Stock.
Material Changes
The filing reports a significant adjustment to the conversion price of the Company's 7.00% Subordinated Convertible Notes due 2031. Due to the lowest conversion price of Series D Preferred Stock being approximately $1.22, the Notes' conversion price was adjusted from approximately $1.97 per share to approximately $0.67 per share. This represents a 45% discount to the $1.22 price, increasing the conversion ratio to approximately 37.19 shares of Common Stock for each $25.00 of principal amount of the Notes.
Outlook, Risks, and Contingencies
- Upcoming Redemption: The next monthly Holder Redemption Date is June 5, 2025, with a request deadline of May 25, 2025.
- Registration Risk: Management anticipates that the current registration statement may not contain enough registered Common Stock shares to settle June redemption requests based on historical volumes.
- Contingency Plans: The Company plans to file a new registration statement. However, there is no assurance it will be effective by the June Redemption Date.
- Potential Outcomes: If the new registration is not effective in time, the Company may issue unregistered Common Stock or delay delivery of registered shares pending SEC clearance.
Investor Verification Checklist
- Verify the effectiveness status of the new registration statement intended to cover June 2025 redemptions.
- Confirm the exact number of registered Common Stock shares currently available versus projected redemption demand for June 5, 2025.
- Review the impact of the new $0.67 conversion price on the dilution potential of the 7.00% Subordinated Convertible Notes due 2031.
- Monitor the Company's website for updates regarding the June redemption forms and FAQ.