Business Context and Reporting Period
Company: The Macerich Company (Macerich) and its operating partnership, The Macerich Partnership, L.P.
Filing Type: Form 8-K (Current Report)
Report Date: August 5, 2026 (Earliest Event Reported)
Event Date: August 11, 2026 (Completion of Offering)
Context: The filing details the completion of a private offering of exchangeable senior notes, the entry into capped call transactions to mitigate dilution, and an amendment to the company's existing credit agreement.
Key Financial Metrics and Transaction Details
- Debt Issuance: $775,000,000 aggregate principal amount of 2.25% Exchangeable Senior Notes due 2031.
- Net Proceeds: Approximately $757.0 million after deducting discounts, commissions, and estimated offering expenses.
- Use of Proceeds: Approximately $45.0 million used to pay costs for Capped Call Transactions; remainder intended to refinance existing secured debt and for general corporate purposes.
- Interest Rate: 2.25% per annum, payable semi-annually in arrears starting February 15, 2027.
- Maturity Date: August 15, 2031.
- Exchange Price: Initial exchange price of approximately $28.19 per share of common stock (35.4761 shares per $1,000 principal amount).
- Capped Call Cap Price: Approximately $34.06 per share (approx. 45% premium over the $23.49 closing price on August 6, 2026).
- Maximum Potential Dilution: Up to 32,992,757 shares of common stock may be issued upon exchange based on the initial maximum exchange rate.
Material Changes and Agreements
Exchangeable Notes Structure: The Notes are senior, unsecured obligations of the Partnership, fully and unconditionally guaranteed by the Company. They are structurally subordinated to all indebtedness of the Partnership's subsidiaries.
- Exchangeability: Noteholders may exchange Notes for cash, common stock, or a combination thereof. Before May 15, 2031, exchange is limited to specific events. After May 15, 2031, exchange is permitted at any time until the trading day before maturity.
- Redemption: The Partnership may redeem Notes on or after August 20, 2029, subject to liquidity conditions and if the stock price exceeds 130% of the exchange price. Redemption is also permitted if necessary to preserve REIT status.
- Make-Whole Fundamental Change: Certain corporate events may trigger an increase in the exchange rate or a mandatory repurchase obligation at 100% of principal plus accrued interest.
Capped Call Transactions: Concurrently with the offering, the Company entered into capped call transactions with financial institutions. These are designed to reduce potential dilution and offset cash payments in excess of the principal amount upon exchange, subject to a cap price of $34.06 per share.
Credit Agreement Amendment: On August 5, 2026, the Company amended its Second Amended and Restated Credit Agreement to facilitate the Notes offering, modifying defined terms and covenants while keeping other terms in full force.
Guidance, Risks, and Contingencies
- Registration Rights: The Company agreed to file a resale registration statement for shares issuable upon exchange. The statement must become effective within 180 days of issuance (or 210 days if a significant acquisition occurs). Failure to maintain effectiveness may trigger additional interest accruals (0.25% for the first 90 days, then 0.50%).
- Events of Default: Includes payment defaults, failure to comply with covenants, defaults on other indebtedness exceeding $150 million, bankruptcy, and failure to exchange Notes upon exercise of rights.
- REIT Status Risk: The Notes include a provision allowing redemption if the Company's board determines it is necessary to preserve the Company's status as a real estate investment trust.
- Market Risk: The exchange value is determined based on a 40-day observation period of VWAP trading prices, introducing volatility risk for both the Company and noteholders.
Investor Verification Checklist
- Verify the exact amount of existing secured debt being refinanced with the net proceeds.
- Confirm the status of the resale registration statement filing and its expected effectiveness date.
- Review the specific terms of the "Make-Whole Fundamental Change" and "Fundamental Change" definitions in the Indenture (Exhibit 4.1).
- Assess the impact of the capped call transactions on the company's equity structure and potential future dilution.
- Check for any subsequent amendments to the Credit Agreement beyond the August 5, 2026 amendment.