Trust Preferred Securities are a type of corporate-level, unsecured, subordinated debt capital with features of both debt and equity. We can also structure a subordinated note issuance with the same terms and benefits.

THE BENEFITS OF TRUST PREFERRED SECURITIES

Long -Term Hybrid Capital Many of the benefits of equity at the lower cost of debt

Competitive Pricing Efficiencies achieved through securitization allow for more attractive pricing than alternative sources of capital

Flexibility No restrictions on uses; covenants are less restrictive than those of other sources of capital

Low Issuance Cost Underwriting, legal and marketing costs are lower than those of a stand-alone debt or equity offering

Private Transaction No road show or registration requirements

Balance Sheet Diversification Trust preferred securities complement an issuer’s existing financing sources by diversifying its capital structure

Tax Advantages Interest expense is tax deductible. REITs may benefit from such deductions by issuing the security from a taxable REIT subsidiary

Equity Consideration Senior lenders and rating agencies often provide quasi-equity treatment for trust preferred securities