Terms

Series

6.125% Series D Cumulative Redeemable Preferred Stock

Liquidation Preference

$25.00

Coupon Rate

6.125%

Rate Type

Fixed

Annual Dividend

$1.53

Payment Frequency

Quarterly

Cumulative

Yes

Perpetual

Yes

Convertible

Yes

Callable

Yes

First Call Date

January 23, 2023

First Call Price

$25.00

Redemption Notice Period

30 days

Capital Stack Ranking

Junior To: All Existing And Future Indebtedness Of Saul Centers, Inc., Indebtedness Of Subsidiaries, Any Future Senior Equity Securities; Pari Passu With: 6.875% Series C Cumulative Redeemable Preferred Stock, Future Parity Equity Securities; Senior To: Common Stock, All Other Equity Securities Not Ranking Senior Or Pari Passu

Regulatory (Basel III) Call

No

Tax Classification

Reit Passthrough

Qualifies for QDI

No

Qualifies for DRD

No

Depositary Share Fraction

0.01

Shares Offered

3,000,000

Prospectus Summary

Saul Centers, Inc. (NYSE: BFS), a self-administered REIT focused on shopping center and mixed-use properties in the Washington, D.C. metro area, is offering 3,000,000 depositary shares, each representing 1/100th of a share of its 6.125% Series D Cumulative Redeemable Preferred Stock, with a liquidation preference of $25.00 per depositary share. The fixed annual dividend of $1.53125 per depositary share ($0.3828125 per quarter) is paid on January 15, April 15, July 15, and October 15, beginning April 15, 2018. These dividends are cumulative — if Saul Centers fails to pay, unpaid dividends accumulate and must be paid in full before any distributions can be made to common shareholders. The Series D is callable at par on or after January 23, 2023. The Series D preferred stock ranks senior to Saul Centers' common stock and on a parity with its outstanding 6.875% Series C Cumulative Redeemable Preferred Stock. It is effectively junior to all of the company's existing and future indebtedness (approximately $968.9 million as of September 30, 2017) and to all liabilities of its operating subsidiaries. Because Saul Centers conducts its business through Saul Holdings Limited Partnership, dividends depend on distributions up from the partnership — a structural subordination risk. There is no bank regulatory capital call; however, the issuer may redeem shares at any time to preserve its REIT status. A special optional redemption right also allows the company to call the shares at par within 120 days of a Change of Control or 90 days of a Delisting Event. At the $25.00 offering price, the effective yield is 6.125%. Because Saul Centers is a REIT, its dividends generally do not qualify for the preferential 15%/20% qualified dividend income (QDI) tax rate available to individual investors, nor for the corporate dividends-received deduction (DRD); they are typically taxable as ordinary income. Dividends are paid quarterly; the record date is set by the Board between 10 and 30 days before each payment date. The dividend stopper provision prevents redemption of any Series D shares and prohibits purchases of the Series D preferred stock (other than by exchange for junior equity) unless all accumulated dividends for all past periods have been paid — protecting existing holders from a partial call while dividends are in arrears.

Summarized from the SEC prospectus filing.

Distribution History

Conversion Terms

Ranking vs. Other Preferreds

Dividend Stopper Provisions

Dividend Stopper Description

If cumulative dividends on the Series D preferred stock are not fully paid for all past periods, the issuer may not redeem or repurchase Series D preferred stock (unless all shares are simultaneously redeemed) and may not pay dividends on junior securities such as common stock.

Other Preferreds from Saul Centers Inc

Div Score Breakdown

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