MIAMI BEACH – The Herzfeld Caribbean Basin Fund, Inc. (NASDAQ:CUBA) has declared a quarterly distribution to shareholders, with payments consisting of both common stock and cash. The fund, which specializes in investment in the Caribbean Basin, announced that the distribution is part of its managed distribution policy which aims to provide shareholders with a steady rate of return.
The distribution, set at $0.135375 per share, will be allocated with a cap of 20% in cash and the remaining approximately 80% in common stock. The payout date for this distribution is scheduled for May 10, 2024, to shareholders of record as of March 27, 2024. The volume weighted average price of the common stock on the Nasdaq Capital Market from April 23 to April 25, 2024, will determine the number of shares distributed.
Shareholders have the option to elect for their distribution to be paid in cash or stock, but the total cash distributed will not exceed the 20% threshold. Those who do not submit a completed election form by the deadline of April 25, 2024, will automatically receive their distribution in stock. The investment feature of the dividend reinvestment plan will be suspended for this distribution and will resume afterwards.
The Fund expects that distributions under its policy will likely include returns of capital, which is a portion of a shareholder’s investment paid back and should not be confused with yield or income. This policy is subject to review and could be changed or terminated by the Board of Directors at any time.
The Fund’s policy, established on December 19, 2023, aims to deliver a fixed minimum rate of distribution quarterly, currently at an annual rate of 15% of the Fund’s net asset value. However, the Fund cannot guarantee the effect of this policy on its share market price or whether the market price will reflect a discount to net asset value compared to before the policy’s adoption.
The Fund’s Board indefinitely suspended the Plan on August 10, 2023, before reinstating it on November 22, 2023, and declaring the quarterly distribution in December. The Fund will distribute all available investment income, and if necessary, return capital to maintain its managed distribution level, in accordance with the Internal Revenue Code.
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