Form 4: Stilwell Entities Disclose Wheeler REIT Holdings

Joseph Stilwell and affiliated entities disclose their beneficial ownership in Wheeler Real Estate Investment Trust, including common stock, convertible notes, and preferred shares.

Summary

• Joseph Stilwell, a Director and 10% owner, along with Stilwell Value LLC and its affiliated L.P.s (Stilwell Activist Investments, L.P., Stilwell Activist Fund, L.P., Stilwell Value Partners VII, L.P., and Stilwell Associates, L.P.), collectively hold significant beneficial ownership in Wheeler Real Estate Investment Trust, Inc. (WHLR).
• The reported holdings include common stock, 7.00% Subordinated Convertible Notes due 2031, Series D Cumulative Convertible Preferred Stock, and Series B Convertible Preferred Stock.
• As of September 30, 2025, the Stilwell entities beneficially own a total of 107,521 shares of common stock directly.
• The entities also hold convertible notes that, if fully converted, would represent 4,920,026 shares of common stock, with an aggregate value of $20,903,600.
• Additionally, they hold Series D Preferred Stock (124,471 shares) and Series B Preferred Stock (789,466 shares), which have extremely high conversion prices ($85,478,400 and $201,600,000 per common share, respectively), making direct common stock conversion practically negligible.
• A transaction on September 30, 2025, involved the sale of 7.00% Subordinated Convertible Notes due 2031 by Stilwell Value Partners VII, L.P., representing 2,389 underlying common shares, with an aggregate principal amount sold for $11,725 at a price of $114.5727 per $25.00 of principal.
• Joseph Stilwell disclaims beneficial ownership of shares owned indirectly by the L.P.s except to the extent of his pecuniary interest.

Sentiment

Score: 5

Explanation: The filing is largely neutral, primarily serving as a disclosure of existing beneficial ownership. The continued significant holdings by an activist investor group could be viewed positively for governance and alignment, while a minor sale of convertible notes and the complex preferred share structures introduce slight nuances without fundamentally altering the overall sentiment.

Positives

• The continued significant beneficial ownership by Joseph Stilwell and affiliated activist investor entities indicates a strong alignment of interests with the company's performance and strategic direction.
• The substantial holdings across various security types (common stock, convertible notes, preferred stock) demonstrate a diversified investment approach and long-term commitment to Wheeler Real Estate Investment Trust.

Negatives

• A minor sale of 7.00% Subordinated Convertible Notes due 2031 by Stilwell Value Partners VII, L.P., occurred on September 30, 2025, which, while small in context of total holdings, represents a reduction in a portion of their convertible debt position.
• The extremely high conversion prices for Series D ($85,478,400 per common share) and Series B ($201,600,000 per common share) Convertible Preferred Stock suggest these preferred shares are not practically convertible into common stock at any reasonable market valuation, potentially indicating other features (e.g., liquidation preferences, dividend rights) that could impact common equity holders.

Risks

• The complex structure of the preferred shares (Series B and D) with their effectively non-convertible common stock ratios could obscure their true impact on common shareholders, particularly regarding liquidation preferences or dividend obligations.
• While Joseph Stilwell disclaims beneficial ownership beyond his pecuniary interest, the concentration of ownership and control through the Stilwell entities could influence corporate decisions in ways that may not always align with all minority shareholders' interests.

Future Outlook

This filing is a statement of beneficial ownership and does not contain any forward-looking statements or guidance regarding the company's future performance or strategic outlook.

Industry Context

This Form 4 filing provides specific details on the beneficial ownership of a key director and activist investor group in Wheeler Real Estate Investment Trust, Inc. It does not offer broader insights into industry trends or competitive landscape, focusing solely on the ownership structure within this particular REIT.

Related Party Transactions

• The filing details the indirect beneficial ownership of Joseph Stilwell through Stilwell Value LLC, which serves as the general partner for several affiliated limited partnerships (Stilwell Activist Investments, L.P., Stilwell Activist Fund, L.P., Stilwell Value Partners VII, L.P., and Stilwell Associates, L.P.). This structure represents related party dealings in terms of shared control and influence over the reported holdings.

Stakeholder Impact

• Shareholders gain transparency regarding the significant holdings of a director and activist investor group, which can influence market perception and confidence.
• The detailed breakdown of common stock, convertible notes, and preferred shares provides clarity on the various forms of investment held by these key stakeholders.

Key Dates

Recommendation

The filing primarily discloses the beneficial ownership of Joseph Stilwell and affiliated entities in Wheeler Real Estate Investment Trust. The continued substantial holdings by an activist investor group, including common stock, convertible notes, and preferred shares, indicates ongoing interest and potential influence. While a minor sale of convertible notes by one affiliated entity was reported, it does not significantly alter the overall ownership structure or imply a change in long-term strategy. The complex conversion terms of the preferred stock warrant careful consideration but are not new information from this filing. Therefore, a 'hold' recommendation is appropriate as the filing does not present new information that would fundamentally change the investment thesis, but rather confirms existing significant insider ownership.

Keywords

Wheeler Real Estate Investment Trust, WHLR, SEC Form 4, Beneficial Ownership, Joseph Stilwell, Stilwell Value, Convertible Notes, Preferred Stock, Real Estate Investment Trust, REIT