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AUSTIN, Texas, March 31, 2025 /PRNewswire/ -- Summit Hotel Properties, Inc. (NYSE: INN) (the "Company") today announced that it has successfully closed on a new $275 million senior unsecured term loan (the "Term Loan"). The Company expects to utilize future proceeds from the Term Loan to repay the majority of the Company's outstanding $287.5 million 1.50% Convertible Senior Notes maturing in February 2026. The Term Loan includes a delayed draw feature available to the Company through March 1, 2026, that will enable the Company to preserve the attractive 1.50% interest rate on the Convertible Senior Notes through the scheduled maturity date.
"We greatly appreciate the continued support of our lending partners and are extremely pleased with the successful execution of this term loan financing. This term loan enables us to maintain the favorable interest rate of the 1.5% Convertible Senior Notes, while further strengthening our well-positioned balance sheet by extending our debt maturity profile and preserving flexibility to execute on our strategic initiatives," commented Trey Conkling, the Company's Executive Vice President and Chief Financial Officer.
The Term Loan provides for a maturity date of March 2030, including two, one-year extension options. The pricing grid of the Term Loan ranges from 135 to 235 basis points over the applicable adjusted Term SOFR rate, with expected initial pricing of SOFR plus 190 basis points. The Term Loan includes an accordion feature that allows the Company to increase commitments by up to $50 million, subject to certain conditions. Other terms of the agreement are similar to the Company's existing credit facility agreements.
As a result of this refinancing, the Company's average length to maturity will increase to nearly four years on a pro forma basis, including extension options, and the Company has no significant debt maturities until 2027. Additionally, the Company currently has approximately $320 million of pro rata total liquidity and approximately 77% pro rata fixed interest rate debt and preferred equity capital after giving effect to interest rate derivative agreements.
The transaction included Bank of America, N.A., as administrative agent, Wells Fargo Bank, N.A., as syndication agent, Capital One, National Association, Huntington National Bank, JPMorgan Chase Bank, N.A., Truist Securities, Inc., U.S. Bank National Association and Raymond James Bank, as co-documentation agents, Wells Fargo Securities LLC, BofA Securities, Inc., Capital One, National Association, Huntington National Bank, JPMorgan Chase Bank, N.A., and Truist Securities, Inc., as joint lead arrangers, and Wells Fargo Securities LLC and BofA Securities, Inc., as joint bookrunners.