21 April 2021
Cromwell Funds Management Limited (CFM) has successfully entered into an interest rate cap arrangement in relation to the Cromwell Property Trust 12, at a strike price of 0.689%, versus the current 3 month BBSY (floating rate). The interest rate cap provides protection against future increases in interest rates above 0.689% per annum, whilst giving unitholders the benefit of current low interest rates.
The new bank facility entered into on 24 February 2021 (see Continuous Disclosure Notice dated 4 March 2021 for further information) and the strike price of the interest rate cap, reduces the maximum interest rate payable by the Trust by 0.17% per annum, as compared to the rate forecast in the Notice of Meeting and Explanatory Memorandum, whilst providing material benefits whilst interest rates remain below 0.689%.
The interest rate cap cost $1 million, taking the Trust’s total debt to $38 million, considered to be an immaterial increase in the LVR from 34.5% to 35.5%.
The interest rate cap’s expiry aligns with the loan facility expiry date of February 2026, which is beyond the October 2025 maturity date for the Trust’s second Term. The facility is fully drawn.
Management and directors of CFM considered this the best option and in Unitholders’ best interests.
If you have any questions, please contact Cromwell’s Investor Services Team on 1300 268 078 or email email@example.com.
Cromwell Funds Management Limited ABN 63 114 782 777 AFSL 333214 (CFM) has prepared this notice and is the responsible entity of, and the issuer of units in, the Cromwell Property Trust 12 ARSN 166 216 995 (Trust). In making an investment decision in relation to the Trust, it is important that you read the product disclosure statement dated 29 October 2013 (PDS). The PDS is issued by CFM and is available from www.cromwell.com.au/c12 or by calling Cromwell’s Investor Services Team on 1300 268 078. The Trust is not open for investment. This notice has been prepared without taking into account your objectives, financial situation or needs. Before making an investment decision, you should consider the PDS and assess, with or without your financial or tax adviser, whether the Trust fits your objectives, financial situation or needs. CFM and its related bodies corporate, and their associates, do not receive any remuneration or benefits for the general advice given in this notice. If you acquire units in the Trust, CFM and certain related parties may receive fees from the Trust and these fees are disclosed in the PDS.
Please note: Any investment, including an investment in the Trust, is subject to risk. If a risk eventuates, it may result in reduced distributions and/or a loss of some or all of the capital value of your investment. See the PDS for examples of key risks. Past performance is not a reliable indicator of future performance. Forward-looking statements in this notice are provided as a general guide only. Capital growth, distributions and tax consequences cannot be guaranteed. Forward-looking statements and the performance of the Trust are subject to the risks and assumptions set out in the PDS.