Business Context and Reporting Period
This Form 8-K Current Report was filed by ACRES Commercial Realty Corp. (formerly Exantas Capital Corp.) on February 16, 2021. The filing documents a corporate restructuring effective as of 5:00 PM Eastern Standard Time on February 16, 2021, consisting of a name change and a 1-for-3 reverse stock split of its common stock.
Key Financial Metrics and Capital Structure
The filing does not provide revenue, profit, cash flow, margin, or debt figures. It focuses exclusively on capital structure adjustments resulting from the reverse stock split:
- Common Stock Outstanding: Reduced from approximately 29.2 million shares to approximately 9.7 million shares.
- Par Value: Remained at $0.001 per share.
- Fractional Share Treatment: Cash payments made at a rate of $13.02 per post-split share for fractional interests.
- Preferred Stock: The 8.625% Fixed-to-Floating Series C Cumulative Redeemable Preferred Stock share count and dividend rate were unaffected. However, change of control conversion right share caps adjusted from 2.17391 to 0.72463, and exchange caps adjusted from 21,739,125 to 7,246,288.87.
- Convertible Notes: The conversion rate for 4.50% Convertible Senior Notes due 2022 adjusted from 83.1676 shares per $1,000 principal to 27.72220 shares per $1,000 principal.
Material Changes Versus Prior Period
The primary material change is the reduction in the number of outstanding common shares by a factor of three. Additionally, the company's trading symbols on the New York Stock Exchange (NYSE) changed effective February 17, 2021:
- Common Stock: Changed from "XAN" to "ACR".
- Preferred Stock: Changed from "XAN PrC" to "ACR PrC".
- CUSIP Numbers: Updated to 00489Q102 for Common Stock and 00489Q201 for Preferred Stock.
Guidance, Outlook, and Management Commentary
The filing contains no financial guidance, outlook, or management commentary regarding future performance. It notes that the reverse stock split was approved by the Board of Directors without stockholder approval under Maryland General Corporation Law. The company confirmed that holders of "street name" shares require no action, as brokerage accounts will be automatically adjusted. Certificated holders will receive instructions within twenty days of the effective time.
Important Facts for Investor Verification
- Verify the adjusted share count in brokerage accounts reflects the 1-for-3 split ratio.
- Confirm the new trading symbols (ACR and ACR PrC) are active on the NYSE.
- Check for cash payments received for any fractional shares eliminated during the split.
- Review the adjusted conversion rates for the 4.50% Convertible Senior Notes due 2022.
- Ensure the updated CUSIP numbers are reflected in trading systems.