Terms

Series

6.250% Series E Cumulative Redeemable Preferred Stock

Liquidation Preference

$25.00

Coupon Rate

6.25%

Rate Type

Fixed

Annual Dividend

$1.56

Payment Frequency

Quarterly

Cumulative

Yes

Perpetual

Yes

Convertible

Yes

Callable

Yes

First Call Date

November 13, 2022

First Call Price

$25.00

Redemption Notice Period

30 days

Capital Stack Ranking

Junior To: All Existing And Future Indebtedness, Any Class Or Series Of Capital Stock Designated As Senior To Series E Preferred Stock; Pari Passu With: Series B Preferred Stock (7.875%), Series C Preferred Stock (7.125%), Series D Preferred Stock (6.45%), Any Class Or Series Designated As Parity Stock; Senior To: Common Stock, Any Class Or Series Designated As Junior Stock

Regulatory (Basel III) Call

No

Tax Classification

Reit Passthrough

Qualifies for QDI

No

Qualifies for DRD

No

Shares Offered

6,400,000

Prospectus Summary

Summit Hotel Properties, Inc. (NYSE: INN), a self-managed hotel REIT focused on premium-branded select-service hotels, is offering 6,400,000 shares of its 6.250% Series E Cumulative Redeemable Preferred Stock at a $25.00 liquidation preference, with a fixed annual dividend of $1.5625 per share ($0.390625 quarterly), paid on or about the last day of February, May, August, and November. The stock is callable at $25.00 on or after November 13, 2022, with no stated maturity date. These dividends are cumulative, meaning any unpaid dividends accrue and must be paid in full before any distributions can be made on junior securities — providing holders with meaningful contractual dividend protection. The Series E Preferred Stock ranks senior to Summit's common stock and any junior-designated stock, and pari passu with its existing Series B (7.875%), Series C (7.125%), and Series D (6.45%) preferred series. It is subordinate to all existing and future debt obligations of the company. Because Summit Hotel Properties is a Maryland REIT holding company that conducts business through its operating partnership, preferred holders are structurally subordinated — claims on assets flow through the operating partnership structure. There is no regulatory (Tier 1) capital call provision; however, upon a qualifying Change of Control where the company's common stock is no longer listed on a major exchange, the issuer may redeem the preferred within 120 days at $25.00 plus accrued dividends, preempting holders' conversion rights. At the $25.00 offering price, the Series E Preferred Stock yields exactly 6.25%. Dividends are paid quarterly on the last day of February, May, August, and November, with the record date set as the first day of the payment month (or up to 90 days but no fewer than 10 days before the payment date). As a REIT-sourced dividend, these payments generally do not qualify for the preferential 15%/20% qualified dividend income (QDI) rate for individual investors, nor the dividends-received deduction (DRD) for corporate holders — they are typically taxed as ordinary income. The dividend stopper prevents any dividend payments on common stock or parity/junior preferred stock if cumulative Series E dividends remain unpaid for any prior period.

Summarized from the SEC prospectus filing.

Distribution History

Conversion Terms

Ranking vs. Other Preferreds

Dividend Stopper Provisions

Dividend Stopper Description

If full cumulative dividends on the Series E Preferred Stock have not been declared and paid or set aside for all past periods, Summit Hotel Properties may not pay dividends on or repurchase common stock or other junior/parity stock.

Other Preferreds from Summit Hotel Properties Inc

Div Score Breakdown

Reinvesty's multi-factor safety analysis for this preferred, composite score: 39 (Weak)