Terms

Series

8.625% Fixed-to-Floating Series C Cumulative Redeemable Preferred Stock

Liquidation Preference

$25.00

Coupon Rate

8.625%

Rate Type

Fixed To Floating

Annual Dividend

$2.16

Payment Frequency

Quarterly

Cumulative

Yes

Perpetual

Yes

Convertible

Yes

Callable

Yes

First Call Date

July 30, 2024

First Call Price

$25.00

Redemption Notice Period

30 days

Capital Stack Ranking

Junior To: All Existing And Future Indebtedness, Senior Equity Securities, Convertible/Exchangeable Debt Securities Prior To Conversion; Pari Passu With: Series A Preferred Stock (8.50%), Series B Preferred Stock (8.25%), Other Parity Equity Securities; Senior To: Common Stock, Junior Equity Securities

Regulatory (Basel III) Call

No

Tax Classification

Reit Passthrough

Qualifies for QDI

No

Qualifies for DRD

No

Shares Offered

4,400,000

Prospectus Summary

Resource Capital Corp. (NYSE: RSO), a diversified commercial mortgage REIT, is offering 4,400,000 shares of its Series C 8.625% Fixed-to-Floating Cumulative Redeemable Preferred Stock at a $25.00 liquidation preference. The stock pays a fixed rate of 8.625% per annum ($2.15625/share annually) through July 29, 2024, then converts to a floating rate of 3-month LIBOR plus 592.7 basis points, with a floor of 8.625%, payable quarterly on January 30, April 30, July 30, and October 30. The security is cumulative — if the company skips or defers a dividend, all arrearages must be paid in full before any distributions can be made on common or parity preferred shares. The issuer may not call the shares before July 30, 2024, after which they are redeemable at $25.00 plus accrued dividends with 30–60 days' notice. The Series C Preferred Stock ranks senior to Resource Capital's common stock and any junior equity securities, but sits on parity with the existing Series A (8.50%) and Series B (8.25%) preferred shares. It ranks junior to all of the company's existing and future debt obligations — a meaningful consideration given the company had approximately $1.5 billion in long-term debt at the time of offering. As a holding company structure, debt obligations at both the corporate and subsidiary levels are structurally senior to preferred holders. There is no regulatory capital call provision, as this is a REIT, not a bank. The company also has a special optional redemption right allowing it to call the preferred at $25.00 within 120 days of a Change of Control event (defined as a >50% voting power acquisition combined with delisting of common stock). At the $25.00 offering price, the initial yield is exactly 8.625%, or approximately $0.539 per quarter. Because Resource Capital Corp. is a REIT, its distributions are generally not eligible for the preferential 15%/20% qualified dividend income (QDI) tax rate available to individual investors, nor the dividends-received deduction (DRD) for corporate holders — they are typically taxable as ordinary income. Distributions are paid on the 30th of January, April, July, and October, with a record date set on the first day of the calendar month of each payment date (or a Board-designated date 10–90 days prior). The dividend stopper mechanic is significant: if the company fails to pay full cumulative distributions on the Series C Preferred for any past period, it is prohibited from paying dividends on, or repurchasing, its common stock or any parity preferred shares (Series A, Series B) until all arrearages are cleared.

Summarized from the SEC prospectus filing.

Distribution History

Floating Rate Terms

Conversion Terms

Ranking vs. Other Preferreds

Dividend Stopper Provisions

Dividend Stopper Description

If Resource Capital Corp. has not paid full cumulative distributions on the Series C Preferred Stock for all past periods, it may not pay dividends on or repurchase its common stock or any parity preferred stock (including Series A and Series B preferred shares).

Other Preferreds from Acres Commercial Realty Corp

Div Score Breakdown

Reinvesty's multi-factor safety analysis for this preferred, composite score: 38 (Weak)