Item 5. Market for Registrant’s Common Equity
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.
Market Information
Our common stock began “regular way” trading on the NYSE under the symbol "PK" on January 4, 2017.
Shareholder Information
At February 19, 2021, we had 13 holders of record of our common stock. However, because our common stock is held by brokers and other institutions on behalf of stockholders, we believe there are substantially more beneficial holders of our common stock than record holders.
In order to comply with certain requirements related to our qualification as a REIT, subject to certain exceptions, our amended and restated certificate of incorporation provides that no person may own, or be deemed to own by virtue of the attribution provisions of the Code, more than 9.8% (in value or by number of shares, whichever is more restrictive) of our outstanding common stock or more than 9.8% (in value or by number of shares, whichever is more restrictive) of any outstanding class or series of our preferred stock.
Distribution Information
In order to maintain our qualification for taxation as a REIT, we intend to distribute annually at least 90% of our REIT taxable income (determined without regard to the deduction for dividends paid and excluding any net capital gain). To avoid paying tax on our income, we intend to make distributions of all, or substantially all, of our REIT taxable income (including net capital gains) to our stockholders. Prior to the COVID-19 pandemic, we regularly declared quarterly cash dividends. However, as a precautionary measure in light of COVID-19, after the payment of the first quarter 2020 dividend, we suspended our quarterly dividend.
Our future distributions will be at the sole discretion of our board of directors. When determining the amount of future distributions, we expect that our board of directors will consider, among other factors, (1) the amount required to be distributed to maintain our status as a REIT, (2) the amount of cash generated from our operating activities, (3) our expectations of future cash flows, (4) our determination of near-term cash needs for debt repayments, existing or future share repurchases, and selective acquisitions of new properties, (5) the timing of significant capital investments and expenditures and the establishment of any cash reserves, (6) our ability to continue to access additional sources of capital, (7) any limitations on our distributions contained in our debt agreements, (8) the sufficiency of legally available assets, and (9) the restrictions on dividends under the indentures for the 2025 Senior Secured Notes and 2028 Senior Secured Notes.
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Share Performance Graph
The following graph compares our cumulative total stockholder return since January 4, 2017 (the day our stock began “regular way” trading on the NYSE) against the cumulative total returns of the National Association of Real Estate Investment Trust (“Nareit”) Equity Index, the Standard and Poor’s MidCap 400 Index (“S&P 400 Index”) and the Standard and Poor’s Corporation Composite 500 Index (“S&P 500 Index”). The graph assumes an initial investment of $100 in our common stock and each of the indexes on January 4, 2017, and that all dividends and other distributions were reinvested. We have historically presented the stock performance graph by comparing our cumulative total shareholder return against the cumulative total return of the S&P 500 Index and the Nareit Equity Index. We have decided to change from the S&P 500 Index to the S&P 400 Index as management believes the S&P 400 Index is more comparable to us which is demonstrated by the fact that we became a part of the S&P 400 Index in September 2019, with 2020 being the first full year that we were a part of the S&P 400 Index. Beginning with our Annual Report on Form 10-K for 2021, we will only present the cumulative total return of the S&P 400 Index and the Nareit Equity Index.
1/4/2017
12/31/2017
12/31/2018
12/31/2019
12/31/2020
Park Hotels and Resorts Inc.
$
100.00
$
111.56
$
108.81
$
117.89
$
84.45
S&P 500 Index
100.00
117.74
110.40
142.28
165.41
S&P 400 Index
100.00
112.07
98.07
121.65
136.02
Nareit Equity Index
100.00
105.23
100.36
126.45
116.34
This performance graph shall not be deemed "filed" for the purposes of Section 18 of the Exchange Act, or incorporated by reference into any filing by us under the Securities Act, except as shall be expressly set forth by specific reference in such filing.
Unregistered Sales of Equity Securities
We did not sell any equity securities during the fiscal year ended December 31, 2020 that were not registered under the Securities Act of 1933, as amended.
Use of Proceeds from Registered Securities
We did not receive any proceeds from registered securities during the fiscal year ended December 31, 2020.
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Purchases of Equity Securities by the Issuer and Affiliate Purchasers
Record Date
Total number of
shares
purchased ( 1)
Weighted average
price paid
per share ( 2)
Total number of
shares purchased
as part of publicly
announced plans
or programs
Maximum number
(or approximate
dollar value) of
common shares
that may yet be
purchased under
the plans or
programs
(in millions)
January 1, 2020 through January 31, 2020
9,248
$
22.99
—
$
300
February 1, 2020 through February 29, 2020
75,032
$
23.57
—
$
300
March 1, 2020 through March 31, 2020
4,557,446
$
14.48
4,550,882
$
234
April 1, 2020 through April 30, 2020
224
$
6.50
—
$
234
May 1, 2020 through May 31, 2020
2,027
$
8.64
—
$
234
June 1, 2020 through June 30, 2020
70
$
11.96
—
$
234
July 1, 2020 through July 31, 2020
313
$
9.63
—
$
234
August 1, 2020 through August 31, 2020
151
$
8.27
—
$
234
September 1, 2020 through September 30, 2020
5,116
$
11.31
—
$
234
October 1, 2020 through October 31, 2020
67
$
10.59
—
$
234
November 1, 2020 through November 30, 2020
21
$
10.48
—
$
234
December 1, 2020 through December 31, 2020
—
$
—
—
$
234
4,649,715
4,550,882
(1)
The number of shares purchased represents shares of common stock repurchased under the previously announced stock repurchase program as well as shares of common stock surrendered by certain of our employees to satisfy their federal and state tax obligations associated with the vesting of restricted common stock.
(2)
The weighted average price paid per share for shares of common stock surrendered by certain employees is based on the closing price of our common stock on the trading date immediately prior to the date of delivery of the shares. The weighted average price paid per share for shares repurchased excludes commissions paid.
Stock Repurchase Program
In February 2019, our Board of Directors approved a stock repurchase program allowing us to repurchase up to $300 million of our common stock over a two-year period, ending in February 2021, and we do not currently anticipate renewing the stock repurchase program. Stock repurchases, if any, would be made through open market purchases, including through Rule 10b5-1 trading programs, in privately negotiated transactions, or in such other manner that would comply with applicable securities laws. The timing of stock repurchases and the number of shares to be repurchased will depend upon prevailing market conditions and other factors, and we may suspend the repurchase program at any time. During the year ended December 31, 2020, we repurchased 4.6 million shares of our common stock for a total purchase price of $66 million. As of December 31, 2020, approximately $234 million remained available for stock repurchases. However, our credit facility and term loan amendments entered into during 2020 impose restrictions surrounding our ability to repurchase stock until certain financial ratio metrics are achieved.
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