Merging company

Fortress REIT: Appointment of Board Sub-Committee and Review of Stock Merger

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:

PORN

LEI: 378900FE98E30F24D975 (Approved as a REIT by the JSE) (“Fortress” or “the company“)

BOARD SUB-COMMITTEE APPOINTMENT AND STOCK MERGER REVIEW

Fortress has made significant progress towards creating a simpler and more robust business model in recent years. The proactive measures undertaken were primarily aimed at protecting and strengthening Fortress’ balance sheet and liquidity position, allowing the Company to continue to develop its logistics real estate pipeline and increase its offshore presence, while maintaining a comfortable level of debt.

While the board of directors of Fortress (“the board”) is optimistic about the prospects for the commercial and real estate sectors in which the company operates, the board of directors believes that the existing capital structure of Fortress, which includes two classes of common stock with equal voting rights but different rights to income distributions, if declared, are not optimal and negatively impact Fortress’s ability to meet minimum distribution requirements of the JSE in order to retain its REIT status.

The Board of Directors believes that maintaining Fortress’s REIT status is in the best interests of the company and both classes of shareholders.

Accordingly, the Board has appointed an independent sub-committee (“the Sub-Committee”) to make recommendations regarding the merger of the existing A and B shares into a single class of common stock (“the Share Merger”). . The sub-committee will include the following independent non-executive directors of the board:

  • Jan Potgieter (subcommittee chair and lead independent director of Fortress);
  • Bram Goossens;
  • Benjamin Kodisang; and
  • Suzanne Ludolph.

Fortress will discuss with the Company’s stakeholders their views on the share merger. The Board anticipates that this process may result in a proposal to Fortress shareholders in the near term.

The Board is aware of the time pressure Fortress faces in meeting the minimum distribution requirements in order to maintain REIT status, given that the Company’s fiscal year ends June 30, 2022 and the company is required to pay a distribution in accordance with JSE listing requirements by October 31, 2022.

Shareholders will be informed as the process progresses.

May 23, 2022

Transaction Advisor and Main Sponsor

Co-sponsor

Warning

Fortress REIT Limited published this content on May 23, 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unmodified, on May 23, 2022 1:05:07 PM UTC.