Dividends and Distributions

6 Months Ended

Jun. 30, 2019

Redeemable Preferred Shares

Series A Cumulative Non-Voting Preferred Shares

In January 2009, the Company issued 125 Series A Cumulative Non-Voting Preferred Shares of beneficial interest, par value $0.01 per share (Series A Preferred Shares) for proceeds of $0.1 million. The Series A Preferred Shares were redeemable by the Company at any time by notice for a price, payable in cash, equal to 100% of each share’s liquidation value of $1,000, plus all accrued and unpaid dividends, plus, if applicable, a redemption premium. Holders of the Series A Preferred Shares were entitled to receive dividends semiannually at a per annum rate equal to 12.5% of the liquidation value.

In 2018, in connection with the IPO, all outstanding Series A Preferred Shares were redeemed resulting in a cash payment of approximately $0.1 million, including accrued and unpaid dividends.

Series B Cumulative Convertible Voting Preferred Shares

During 2010, the Company’s Board of Trustees approved a series of agreements and documents that effected the conversion of 375,000 authorized and unissued preferred shares of the Company into 375,000 Series B Cumulative Convertible Voting Preferred Shares of beneficial interest, par value $0.01 per share (Series B Preferred Shares), and simultaneously authorized the sale and issuance of the 375,000 Series B Preferred Shares. On December 15, 2010, the Company issued 375,000 Series B Cumulative Convertible Voting Preferred Shares of beneficial interest, par value $0.01 per share (Series B Preferred Shares), for proceeds of $368.5 million. Of the total issuance, 325,000 Series B Preferred Shares were issued to affiliates of Goldman and 50,000 were issued to an affiliate of China Merchant Holdings International (CMHI), an affiliate of the majority partner in the China JV.

In connection with the IPO, Goldman and CMHI converted their Series B Preferred Shares into 28,808,224 and 4,432,034 common shares of the Company, respectively, after taking into account a cash payment of approximately $1.8 million of accrued and unpaid dividends. Subsequent to the IPO, CMHI and Goldman have sold their remaining shares of the Company. Refer to Note 1 for further details.

Dividends and Distributions

In order to comply with the REIT requirements of the Internal Revenue Code, or the Code, the Company is generally required to make common share distributions (other than capital gain distributions) to its shareholders at least equal to 90% of its REIT taxable income, as defined in the Code, computed without regard to the dividends paid deduction and net capital gains. The Company’s common share dividend policy is to distribute a percentage of cash flow to ensure distribution requirements of the IRS are met while allowing the Company to retain cash to meet other needs, such as principal amortization, capital improvements and other investment activities.

Common share dividends are characterized for U.S. federal income tax purposes as ordinary income, qualified dividend, capital gains, non-taxable income return of capital, or a combination of the four. Common share dividends that exceed current and accumulated earnings and profits (calculated for tax purposes) constitute a return of capital rather than a dividend and generally reduce the shareholder’s basis in the common share. To the extent that a dividend exceeds both current and accumulated earnings and profits and the shareholder’s basis in the common share, it will generally be treated as a gain from the sale or exchange of that shareholder’s common share. At the beginning of each year, we notify our shareholders of the taxability of the common share dividends paid during the preceding year. The payment of common share dividends is dependent upon our financial condition, operating results, and REIT distribution requirements and may be adjusted at the discretion of the Company’s Board of Trustees.

The following tables summarize dividends declared and distributions paid to the holders of common shares and Series B Preferred Shares for the six months ended June 30, 2019 and 2018.



Six Months Ended June 30, 2019
Month Declared/Paid	Dividend Per Share		Distributions Declared				Distributions Paid
			Common Shares		Series B Preferred Shares		Common Shares			Series B Preferred Shares
(In thousands, except per share amounts)
December (2018)/January	$	0.1875	$	—	$	—	$	28,218		$	—
December^(a)							(127		)	—		Dividend equivalents accrued on unvested restricted stock units to be paid when the awards vest.
December (2018)/January							7			—		Dividend equivalents paid on unvested restricted stock units that are not expected to vest (recognized as additional compensation).
March/April	0.2000		30,235		—		30,235			—
March^(b)							(142		)	—		Dividend equivalents accrued on unvested restricted stock units to be paid when the awards vest.
March/April							15			—		Dividend equivalents paid on unvested restricted stock units that are not expected to vest (recognized as additional compensation).
June/July	0.2000		38,764		—		—			—
			$	68,999	$	—	$	58,206		$	—


(a)	Declared in December 2018 and included in the $28.2 million declared, see description to the right regarding timing of payment.


(b)	Declared in March and included in the $30.2 million declared, see description to the right regarding timing of payment.



Six Months Ended June 30, 2018
Month Declared/Paid	Dividend Per Share		Distributions Declared				Distributions Paid
			Common Shares		Series B Preferred Shares		Common Shares			Series B Preferred Shares
(In thousands, except per share amounts)
January ^(a)	$	0.0186	$	1,291	$	619	$	1,291		$	619
March/April	0.1396		20,145		—		20,145
March ^(c)							(79		)	—		Dividend equivalents accrued on unvested restricted stock units to be paid when the awards vest.
March/April							20			—		Dividend equivalents paid on unvested restricted stock units that are not expected to vest (recognized as additional compensation).
June/July	0.1875		27,250		—		—			—
			$	48,686			$	21,377

Series B Preferred Shares - Fixed Dividend
January ^(b)					1,198					1,198
Total distributions paid to holders of Series B Preferred Shares					$	1,817				$	1,817


(a)	Stub period dividend paid to shareholders of record prior to the IPO.


(b)	Last participating and fixed dividend paid to holders of Series B Preferred Shares in connection with the conversion to common shares on the IPO date.


(c)	Declared in March and included in the $20.1 million declared, see description to the right regarding timing of payment.

Partners' Capital

Allocations of Net Income and Net Losses to Partners

The operating partnership’s net income will generally be allocated to Americold Realty Trust (the general partner) and the operating partnership’s limited partner, Americold Realty Operations, Inc., in accordance with the respective percentage interests in the units issued by the operating partnership. Net loss will generally be allocated to the general partner and the operating partnership’s limited partners in accordance with the respective common percentage interests in the operating partnership until the limited partner’s capital is reduced to zero and any remaining net loss would be allocated to the general partner. However, in some cases, losses may be disproportionately allocated to partners who have guaranteed our debt. The allocations described above are subject to special allocations relating to depreciation deductions and to compliance with the provisions of Sections 704(b) and 704(c) of the Code, and the associated Treasury Regulations.

Distributions

All distributions on our units are at the discretion of Americold Realty Trust's Board of Trustees. We have declared and paid the following distributions to Americold Realty Trust for the six months ended June 30, 2019 and 2018:



Six Months Ended June 30, 2019
Month Declared/Paid	Distributions Declared		Distributions Paid
(In thousands)
December (2018)/January	$	—	$	28,098
March/April	$	30,235	$	30,108
June/July	38,764		—
	$	68,999	$	58,206



Six Months Ended June 30, 2018
Month Declared/Paid	Distributions Declared		Distributions Paid
(In thousands)
January ^(a)	$	3,242	$	3,242
March/April	20,145		20,165
March ^(b)	—		(79		)
June/July	27,250		—
	$	50,637	$	23,328


(a)	Stub period distribution paid to Parent immediately prior to the IPO.


(b)	Distribution equivalents declared in March and included in the $20.1 million, accrued on unvested restricted stock units to be paid when the awards vest.