MCLEAN, Va.--(BUSINESS WIRE)--Park Hotels & Resorts Inc. (NYSE: PK) (the “Company”) today announced that its Board of Directors has declared a special dividend of $2.79 per share (the “E&P Dividend”), or approximately $551 million in cash and shares of the Company’s common stock, payable to stockholders of record as of January 19, 2017. The E&P Dividend represents the Company’s estimated share of C corporation earning and profits attributable to the period prior to January 4, 2017, which the Company is required to pay to its stockholders in connection with its election to be treated as a real estate investment trust (“REIT”).
Stockholders on the January 19, 2017 record date will be entitled to elect to receive their portion of the E&P Dividend in cash or shares of the Company’s common stock, with no more than 20% of the E&P Dividend in the aggregate to be paid in cash. If cash elections exceed the approved amount, stockholders will receive a pro-rata amount of their distribution in cash and the remaining portion in stock. Stockholders will be required to make their elections no later than February 28, 2017. The Company expects to pay the E&P Dividend on or as soon as practicable after March 9, 2017.
Election materials and forms to be mailed to stockholders promptly after the record date will describe in more detail the election process for the E&P Dividend, the limitations on the total amount of cash the Company will pay and related logistical matters. Regardless of the form in which it is received, the Company expects that the E&P Dividend will be a taxable dividend to stockholders. The E&P Dividend may be subject to applicable withholding taxes. Although REIT dividends generally are not eligible for taxation at the preferential income tax rates (i.e., the 20% maximum U.S. federal rate that applies to qualified dividends received from taxable corporations by most U.S. stockholders that are individuals, trusts or estates), the E&P Dividend will be considered a qualified dividend eligible for tax at the preferential rates to the extent that it is attributable to the Company’s accumulated C corporation earnings and profits from pre-REIT years.
About Park Hotels & Resorts
Park Hotels & Resorts Inc. (NYSE: PK) is one of the largest publicly traded lodging real estate investment trusts with a diverse portfolio of market-leading hotels and resorts with significant underlying real estate value. The Company’s portfolio currently consists of 67 premium-branded hotels and resorts with over 35,000 rooms located in prime U.S. and international markets with high barriers to entry. For additional information, please visit the Company's website at www.pkhotelsandresorts.com.
Special Note About Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that are based on the beliefs and assumptions of management of Park Hotels & Resorts Inc. (the “Company”) and on information currently available to the Company’s management. Forward-looking statements include, but are not limited to, statements related to the Company’s future payment of the E&P Dividend. Forward-looking statements include all statements that are not historical facts and can be identified by the use of forward-looking terminology such as the words “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “could,” “seeks,” “approximately,” “projects,” “predicts,” “intends,” “plans,” “estimates,” “anticipates” or the negative version of these words or other comparable words.
Forward-looking statements involve risks, uncertainties and assumptions. Actual results may differ materially from those expressed in these forward-looking statements. You should not put undue reliance on any forward-looking statements in this press release. The Company does not have any intention or obligation to update any forward-looking statements contained in this press release.
Factors that could cause the Company’s results to differ materially from those expressed in forward-looking statements are included in the section entitled “Risk Factors” of the Company’s Registration Statement on Form 10, originally filed with the Securities and Exchange Commission on June 2, 2016, as amended and supplemented. There may be other risks and uncertainties that the Company is unable to predict at this time or that the Company currently does not expect to have a material adverse effect on the Company’s business. Any such risks could cause the Company’s results to differ materially from those expressed in forward-looking statements.