Terms

Series

7.875% Series A Cumulative Redeemable Preferred Stock

Liquidation Preference

$25.00

Coupon Rate

7.875%

Rate Type

Fixed

Annual Dividend

$1.97

Payment Frequency

Quarterly

Cumulative

Yes

Perpetual

Yes

Convertible

Yes

Callable

Yes

First Call Date

May 5, 2026

First Call Price

$25.00

Capital Stack Ranking

Junior To: All Debt Obligations Of Lument Finance Trust, Inc.; Pari Passu With: Any Future Parity Preferred Stock; Senior To: Common Stock

Regulatory (Basel III) Call

No

Tax Classification

Reit Passthrough

Qualifies for QDI

No

Qualifies for DRD

No

Shares Offered

2,400,000

Prospectus Summary

Lument Finance Trust, Inc. (NYSE: LFT), a Maryland-based REIT focused on transitional floating-rate commercial real estate debt, is offering 2,400,000 shares of its 7.875% Series A Cumulative Redeemable Preferred Stock at a $25.00 liquidation preference, with dividends paid quarterly on January 15, April 15, July 15, and October 15 (equivalent to $1.96875 per share annually). The stock is callable at $25.00 on or after May 5, 2026, and has no stated maturity. The Series A is cumulative, meaning that if dividends are not paid in any quarter, they accrue and must be paid in full before any distributions can be made on junior securities such as common stock. The Series A Preferred Stock ranks senior to Lument Finance Trust's common stock with respect to dividends and liquidation proceeds, but is junior to all of the company's debt obligations, including its non-recourse CRE CLOs and corporate credit facility. As a holding company issuing preferred equity directly, investors are exposed to the consolidated asset and liability base of the REIT. There is no banking regulatory capital call provision; however, the issuer retains the right to redeem the preferred early if necessary to preserve its REIT qualification for U.S. federal income tax purposes. Additionally, upon a Change of Control/Delisting event, the issuer may redeem within 120 days at $25.00, or holders may convert into common stock at a rate capped at 13.2626 shares per preferred share. At the $25.00 offering price, the Series A Preferred Stock yields 7.875% annually, or approximately $0.4922 per quarter. As a REIT, Lument Finance Trust's dividends are generally classified as ordinary income (REIT pass-through) and do not qualify for the preferential 15%/20% qualified dividend income (QDI) rate available to individual investors, nor for the corporate dividends-received deduction (DRD). If cumulative dividends are in arrears for six or more quarterly periods (consecutive or not), holders gain limited voting rights. The dividend stopper prevents any common stock distributions until all accrued Series A dividends are paid current, providing a meaningful structural protection to preferred holders.

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 A Preferred Stock are in arrears, the issuer is restricted from paying dividends on junior securities, including common stock, until all accrued and unpaid preferred dividends are paid in full.

Other Preferreds from Lument Finance Trust Inc

Div Score Breakdown

Reinvesty's multi-factor safety analysis for this preferred, composite score: 45 (Average)