Item 5. Market for Registrant’s Common Equity
Item 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
Market Information
Our securities are currently not listed on any exchange, and we do not intend to list our securities on any securities exchange until at least 2024. Therefore, we do not expect a public market for them to develop in
the foreseeable future. Therefore, a stockholder may not be able to sell our stock at a time or price acceptable to the stockholder, if at all.
We are currently offering shares of our common stock on a continuous basis at a current offering price of $10.25 per share. We may not generally issue and sell our common stock at a price below NAV per share. We may,
however, sell our common stock, or warrants, options or rights to acquire our common stock, at a price below the then-current NAV per share of our common stock if our Board of Directors determines that such sale is in the best interests of the
Company and our stockholders, and our stockholders approve such sale. In any such case, the price at which our securities are to be issued and sold may not be less than a price that, in the determination of our Board of Directors, closely
approximates the market value of such securities (less any distributing commission or discount).
Holders
As of September 21, 2020, we had 12,852,386.91 shares of common stock outstanding, held by a total of 2,915 stockholders.
Dividends and Taxable Income
We pay quarterly dividends to stockholders to the extent that we have income from operations available. Our quarterly dividends, if any, will be determined by our Board of Directors after a review and distributed
pro-rata to holders of our shares; we declare dividends on a monthly basis, but pay each quarter. Any dividends to our stockholders will be declared out of assets legally available for distribution. In no event are we permitted to borrow money to
make dividends if the amount of such dividend would exceed our annual accrued and received revenues, less operating costs. Dividends in kind are not permitted, except as provided in our Charter.
We have elected to be treated as a REIT under the Code. As a REIT, we are not subject to federal income taxes on amounts that we distribute to the stockholders, provided that, on an annual basis, we distribute at least
90% of our REIT taxable income to the stockholders and meet certain other conditions. To the extent that we satisfy the annual distribution requirement but distribute less than 100% of the taxable income, we will either be subject to U.S. federal
corporate income tax on our undistributed taxable income or 4% excise tax on catch-up distributions paid in the subsequent year. We are also subject to tax on built-in gains we realize during the first five years following REIT election.
We have a dividend reinvestment plan (“DRIP”) that provides for reinvestment of our dividends and other distributions on behalf of stockholders for any individual stockholder who elects to participate in the DRIP,
provided that the DRIP is permitted by the state in which the stockholders resides. We can offer no assurance that we will achieve results that will permit the payment of any cash dividends and, if we issue senior securities, we are prohibited from
paying dividends if doing so causes us to fail to maintain the asset coverage ratios stipulated by the 1940 Act or if dividends are limited by the terms of any of our borrowings.
On March 31, 2020, after assessing the impacts of the Covid-19 pandemic, the Company’s board of directors unanimously approved the suspension of regular quarterly dividends to the Company’s stockholders, effective
immediately.
During the years ended June 30, 2020 and 2019, we issued 317,840.42 and 334,007.67 shares of our common stock, respectively, in connection with the DRIP.
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The following tables reflect the dividends per share that the Company has declared on its common stock during the years ended June 30, 2020 and 2019.
Dividends
During the Quarter Ended
Per Share
Amount
September 30, 2019
$
0.175
$
1,983,801
December 31, 2019
0.175
2,096,915
March 31, 2020
0.120
1,461,875
$
0.470
$
5,542,591
Dividends
During the Quarter Ended
Per Share
Amount
September 30, 2018
$
0.175
$
1,571,551
December 31, 2018
0.206
1,994,972
March 31, 2019
0.175
1,794,012
June 30, 2019
0.175
1,877,100
$
0.731
$
7,237,635
Recent Sale of Unregistered Securities
On May 20, 2020, the Company formed an operating partnership, MacKenzie Realty Operating Partnership, LP (the “OP”) to acquire all the membership interests of Addison Property Owner, LLC (the “Property Owner”) in
exchange for 516,144 Class A limited partnership units in the OP (the “OP Units”). The OP Units were issued and sold at a stated value of $10.25 per OP Unit. The OP Units have a conversion right pursuant to which the holders may convert such OP
units to shares of the Company on a 1:1 basis (or into cash at the election of the Company), subject to the terms and conditions of the limited partnership agreement of the OP and the terms of the contribution agreement under which the OP Units were
issued. The OP Units are entitled to distributions of cash equal to distributions made to holders of the number of shares of the Company into which the OP Units are convertible.
The private placement of the OP Units is exempt from registration under the Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), and Regulation D thereunder.
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Issuer Purchases of Equity Securities
The following table presents information with respect to the Company’s purchases of its common stock during the year ended June 30, 2020 and 2019:
Period
Total Number of Shares Purchased
Average Price Paid Per Share
Total Number of Shares Purchased as Part of Publicly Announced Plans
Maximum Dollar Value of Shares That May Yet Be Purchased Under Publicly Announced Plans
During the year ended June 30, 2020:
August 13, 2019 through September 16, 2019
70,114.03
$
9.00
70,114.03
-
November 18, 2019 through December 19, 2019
102,739.90
$
9.00
102,739.90
-
February 14, 2020 through March 18, 2020
178,344.44
$
9.19
178,344.44
-
351,198.37
351,198.37
During the year ended June 30, 2019:
August 17, 2018 through September 17, 2018
31,570.04
$
9.00
31,570.04
-
November 14, 2018 through December 18, 2018
19,944.93
$
9.00
19,944.93
-
February 14, 2019 through March 18, 2019
78,252.02
$
9.00
78,252.02
-
May 14, 2019 through June 21, 2019
133,347.94
$
9.00
133,347.94
-
263,114.93
263,114.93
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Item 6. SELECTED FINANCIAL DATA
The selected financial data below reflects our operations for our fiscal years ended June 30, 2020 (" Fiscal 2020 "), June 30, 2019 (" Fiscal 2019 "), June 30, 2018 (" Fiscal 2018 "), June 30, 2017 (" Fiscal
2017 ") and June 30, 2016 (“ Fiscal 2016 ”). The selected financial data have been derived from audited consolidated financial statements. The data should be read in conjunction with "Item 7. Management's Discussion and Analysis of
Financial Condition and Results of Operations" and the audited consolidated financial statements and related notes included elsewhere in this Annual Report on Form 10-K.
For the Year Ended
Consolidated statement of operations data:
June 30, 2020
June 30, 2019
June 30, 2018
June 30, 2017
June 30, 2016
Total investment income
$
8,729,941
$
11,879,290
$
6,978,365
$
4,770,584
$
2,636,405
Total operating expenses
$
5,261,084
$
6,248,532
$
4,747,735
$
3,035,978
$
1,828,418
Income tax (expense) benefit
$
-
$
13,348
$
(3,431)
$
(800)
$
1,412
Net investment income
$
3,468,857
$
5,644,106
$
2,227,199
$
1,733,806
$
809,399
Net realized gain on sale of investments
$
1,799,988
$
1,204,050
$
2,691,773
$
1,596,367
$
2,809,740
Net unrealized gain (loss) on investments
$
(16,994,397)
$
(3,962,649)
$
5,846,839
$
2,023,069
$
(16,668)
Net increase (decrease) in net assets resulting from operations
$
(11,725,552)
$
2,885,507
$
10,765,811
$
5,353,242
$
3,602,471
Weighted average common Shares outstanding
12,198,040
9,951,816
7,440,841
5,183,166
3,073,448
Per Share data:
Net investment income per Share
$
0.28
$
0.57
$
0.30
$
0.33
$
0.26
Net realized gain on sale of investments per Share
$
0.15
$
0.12
$
0.36
$
0.31
$
0.91
Net unrealized gain (loss) on investments
$
(1.39)
$
(0.40)
$
0.79
$
0.39
$
(0.01)
Net increase (decrease) in net assets resulting from operations per Share
$
(0.96)
$
0.29
$
1.45
$
1.03
$
1.16
Dividend paid per Share
$
0.470
$
0.731
$
0.950
$
0.885
$
0.935
Consolidated statement of assets and liabilities data:
June 30, 2020
June 30, 2019
June 30, 2018
June 30, 2017
June 30, 2016
Investments at fair value
$
93,705,145
$
103,245,148
$
74,584,506
$
47,885,527
$
39,176,772
Cash and cash equivalents
$
8,957,393
$
1,278,668
$
8,442,249
$
11,849,712
$
2,350,435
Total assets
$
104,166,764
$
108,353,254
$
89,566,296
$
62,504,852
$
42,315,221
Total liabilities
$
941,043
$
5,237,873
$
3,970,977
$
2,515,327
$
1,983,030
Total net assets
$
103,225,721
$
103,115,381
$
85,595,319
$
59,989,525
$
40,332,191
Net asset value per Share at end of the year
$
8.04
$
9.44
$
10.07
$
9.84
$
9.94
Shares outstanding at end of the year
12,836,608.02
10,926,319.99
8,496,141.57
6,096,772.85
4,057,319.49
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Text extracted from the filing as submitted to EDGAR. Formatting, tables and exhibits are simplified for reading; the original document is authoritative for anything you rely on.