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EQUITY AND MEZZANINE EQUITY
 9 Months Ended
Sep. 30, 2024
Equity [Abstract]  
EQUITY AND MEZZANINE EQUITY
10. EQUITY AND MEZZANINE EQUITY
Common Stock. Upon the consummation of the Corporate Reorganization, each outstanding common unit of the Partnership was converted into the right to receive 1.000 shares of common stock of Summit Midstream Corporation. An update on the number of shares of common stock is as follows for the period from December 31, 2023 to September 30, 2024:
Common Units
Shares of Common Stock
Units, December 31, 202310,376,189 — 
Common units issued for SMLP LTIP, net
272,496 — 
Corporate Reorganization
(10,648,685)10,648,685 
Shares, September 30, 2024— 10,648,685 
Series A Preferred Stock. Upon the consummation of the Corporate Reorganization, each outstanding Series A Preferred Unit was converted into the right to receive 1.000 shares of Series A Preferred Stock of Summit Midstream Corporation, with the liquidation preference of each share of Series A Preferred Stock initially equal to $1,000 and the Certificate of Designation of Series A Floating Rate Cumulative Redeemable Perpetual Preferred Stock of Summit Midstream Corporation (the “Series A Certificate of Designation”) deeming all accumulated and unpaid distributions on the Series A Preferred Units to be Series A Unpaid Cash Dividends (as defined in the Series A Certificate of Designation) per share of Series A Preferred Stock, which constituted all consideration to be paid in respect to such Series A Preferred Units, and any rights to accumulated and unpaid distributions on such Series A Preferred Units were discharged. As of September 30, 2024, the Company had 65,508 shares of Series A Preferred Stock outstanding and $43.0 million of accrued and unpaid distributions on its Series A Preferred Stock.
An update on the number of shares of Series A Preferred Stock is as follows for the period from December 31, 2023 to September 30, 2024:
Series A Preferred Units
Series A Preferred Stock
Units, December 31, 202365,508 — 
Corporate Reorganization
(65,508)65,508 
Shares, September 30, 2024— 65,508 
Subsidiary Series A Preferred Units. The Company records its Subsidiary Series A Preferred Units at fair value upon issuance, net of issuance costs, and subsequently records an effective interest method accretion amount each reporting period to accrete the carrying value to a most probable redemption value that is based on a predetermined internal rate of return measure. Net income (loss) attributable to common stockholders includes adjustments for payment-in-kind distributions and redemption accretion.
As of September 30, 2024, the Company had 93,039 Subsidiary Series A Preferred Units issued and outstanding.
If the Subsidiary Series A Preferred Units were redeemed on September 30, 2024, the redemption amount would be $130.6 million when considering the applicable multiple on invested capital metric and make-whole amount provisions contained in the Amended and Restated Limited Liability Company Agreement of Permian Holdco.
The following table shows the change in the Company’s Subsidiary Series A Preferred Unit balance from January 1, 2024 to September 30, 2024, net of $1.3 million and $1.7 million of unamortized issuance costs at September 30, 2024 and December 31, 2023, respectively:
(In thousands)
Balance at December 31, 2023$124,652 
Redemption accretion, net of issuance cost amortization
11,643 
Cash distribution (includes a $1.6 million distribution payable as of September 30, 2024)
(4,885)
Balance at September 30, 2024$131,410 
Blank Check Common Stock. The Board of Directors is authorized to establish one or more series of Blank Check Common Stock (including convertible Blank Check Common Stock). The Board of Directors has the ability to determine, with respect to any series of Blank Check Common Stock, the powers, preferences and relative, participating, optional or other special rights, and the qualifications, limitations or restrictions thereof, including, without limitation (i) the designation of the series; (ii) the number of shares of the series, which the Board of Directors may, except where otherwise provided in the Blank Check Common Stock designation, increase (but not above the total number of authorized shares of the class) or decrease (but not below the number of shares then outstanding); (iii) whether dividends, if any, will be cumulative or non-cumulative and the dividend rate of the series; (iv) the dates at which dividends, if any, will be payable; (v) the redemption or repurchase rights and price or prices, if any, for shares of the series; (vi) the terms and amounts of any sinking fund provided for the purchase or redemption of shares of the series; (vii) the amounts payable on shares of the series in the event of any voluntary or involuntary liquidation, dissolution or winding-up of the Company’s affairs; (viii) whether the shares of the series will be convertible into shares of any other class or series, or any other security, of the Company or any other entity, and, if so, the specification of the other class or series or other security, the conversion price or prices or rate or rates, any rate adjustments, the date or dates as of which the shares will be convertible and all other terms and conditions upon which the conversion may be made; (ix) restrictions on the issuance of shares of the same series or of any other class or series; and (x) the voting rights, if any, of the holders of the series. As of September 30, 2024, no Blank Check Common Stock has been issued.
Cash Distribution Policy. In March 2020, the Partnership suspended cash distributions to holders of its common units and Series A Preferred Units, commencing with respect to the quarter ended March 31, 2020. Upon the resumption of distributions, the Partnership Agreement would have required that it distribute all available cash, subject to reserves established by its General Partner, within 45 days after the end of each quarter to unitholders of record on the applicable record date. The amount of distributions paid under this policy was subject to fluctuations based on the amount of cash the Partnership generated from its business and the decision to make any distribution was determined by the General Partner, taking into consideration the terms of the Partnership Agreement.
There were no distributions paid by the Company or the Partnership, as applicable, during the three and nine months ended September 30, 2024, or during the twelve months ended December 31, 2023. In connection with the consummation of the Corporate Reorganization, the Partnership Agreement was amended by the Fifth Amended and Restated Agreement of Limited Partnership to, among other things, reflect that all of the issued and outstanding limited partnership interests of the Partnership are held by the Company. For information on the Corporate Reorganization, see Note 1– Organization, Business Operations, Corporate Reorganization and Presentation and Consolidation.