ITEM 3.02 UNREGISTERED SALES OF EQUITY SECURITIES.
As described in the Annual Report on Form 10-K filed with the Securities and
Exchange Commission (the "SEC") by Bluerock Residential Growth REIT, Inc. (the
"Company") on February 23, 2021 (the "Form 10-K"), the respective employment or
services agreement of each of the Company's executive officers (collectively,
the "Executive Agreements") are to continue in effect for an automatic renewal
term through and including December 31, 2021, subject to further automatic
renewals of additional successive one-year periods (each, a "Renewal Term"),
unless either party thereto provides at least sixty (60) days' advance notice of
non-renewal. Effective as of December 31, 2021, each of the Executive Agreements
automatically renewed for a Renewal Term through and including December 31,
2022. As further described in the Form 10-K, pursuant to the Executive
Agreements, each of the Company's executive officers is eligible to receive
certain annual equity grants of long-term incentive plan units ("LTIP Units") of
the Company's operating partnership, Bluerock Residential Holdings, L.P. (the
"Operating Partnership," and such equity grants, collectively, the "Executive
Awards") pursuant to the Company's Fourth Amended and Restated 2014 Equity
Incentive Plan for Individuals (the "Individuals Plan") and Fourth Amended and
Restated 2014 Equity Incentive Plan for Entities (the "Entities Plan," and
together with the Individuals Plan, the "Equity Incentive Plans"). The Executive
Agreements provide that grants of Executive Awards will be made annually on
January 1 of each year during the term or any Renewal Term thereof.
Grants of Executive Awards
On January 1, 2022, the Company granted the following Executive Awards to each
of the following executive officers of the Company: (i) R. Ramin Kamfar ("Mr.
Kamfar"), (ii) James G. Babb, III ("Mr. Babb"), (iii) Ryan S. MacDonald ("Mr.
MacDonald"), (iv) Jordan B. Ruddy ("Mr. Ruddy"), (v) Christopher J. Vohs ("Mr.
Vohs"), (vi) Michael DiFranco ("Mr. DiFranco"), and (vii) Michael L. Konig ("Mr.
Konig"), through his wholly-owned law firm, Konig & Associates, LLC, a New
Jersey limited liability company ("K&A"), under the Equity Incentive Plans:
(a) A time-vested equity award of the following number of LTIP Units (each, an
"Annual LTIP Award"): 58,409 LTIP Units to Mr. Kamfar; 11,056 LTIP Units to
Mr. Babb; 20,860 LTIP Units to Mr. MacDonald; 17,731 LTIP Units to Mr. Ruddy;
4,172 LTIP Units to Mr. Vohs; 6,258 LTIP Units to Mr. DiFranco; and 15,645
LTIP Units to K&A. Each such Annual LTIP Award will vest and become
nonforfeitable in three equal installments on each anniversary of grant,
subject to certain clawback and termination provisions; and
(b) A long term performance equity award of the following number of LTIP Units
for a three-year performance period, subject to performance criteria and
targets established and administered by the Compensation Committee of the
Company's board of directors (each, a "Long Term Performance Award"): 116,818
LTIP Units to Mr. Kamfar; 22,112 LTIP Units to Mr. Babb; 41,721 LTIP Units to
Mr. MacDonald; 35,463 LTIP Units to Mr. Ruddy; 8,344 LTIP Units to Mr. Vohs;
12,516 LTIP Units to Mr. DiFranco; and 31,291 LTIP Units to K&A. Each such
Long Term Performance Award will vest and become nonforfeitable effective as
of the last day of the performance period, subject to certain clawback and
termination provisions.
Each such Executive Award is evidenced by an LTIP Unit Vesting Agreement.
The LTIP Units granted as Executive Awards to each of Mr. Kamfar, Mr. Babb, Mr.
MacDonald, Mr. Ruddy, Mr. Vohs, Mr. DiFranco and K&A were issued in reliance
upon exemptions from registration provided by Section 4(a)(2) of the Securities
Act of 1933 and Regulation D thereunder for transactions not involving any
public offering. No general solicitation or advertising occurred in connection
with the issuance and sale of these securities. Such LTIP Units may convert to
units of limited partnership interest in the Operating Partnership ("OP Units")
upon reaching capital account equivalency with the OP Units held by the Company,
and may then be redeemed for cash or, at the option of the Company and after a
one year holding period (including any period during which the LTIP Units were
held), settled in shares of the Company's Class A common stock (the "Class A
Common Stock") on a one-for-one basis. From the date of grant, holders of LTIP
Units granted as Executive Awards will be entitled to receive "distribution
equivalents" at the time distributions are paid to the holders of the Company's
Class A Common Stock; provided, that (i) solely with respect to LTIP Units
granted as part of Long Term Performance Awards, distributions will be paid at a
rate of ten percent (10%) of the distributions otherwise payable with respect to
such LTIP Units until the last day of the three-year performance period (or the
date of forfeiture, if earlier); and (ii) with respect to each LTIP Unit granted
as part of a Long Term Performance Award that becomes fully vested in accordance
with the terms of the applicable Executive Agreement, the holder will be
entitled to receive, as of the date of such vesting, a single cash payment equal
to the distributions payable with respect to each such LTIP Unit back to the
date of grant, minus the distributions already paid on each such LTIP Unit in
accordance with clause (i), in each case subject to certain potential
limitations on distributions set forth in the limited partnership agreement of
the Operating Partnership.
Board Compensation
On January 1, 2022, the Company granted 3,546 LTIP Units to each of Elizabeth
Harrison, Kamal Jafarnia, I. Bobby Majumder, and Romano Tio, the non-employee
members of the Company's board of directors, in payment of the equity portion of
their respective annual retainers (such grants, collectively, the "Director
Grants"). The LTIP Units issued as Director Grants were issued pursuant to the
Individuals Plan. Each such Director Grant is evidenced by an LTIP Unit Award
Agreement.
The issuances of LTIP Units as Director Grants were made in reliance upon
exemptions from registration provided by Section 4(a)(2) of the Securities Act
of 1933 and Regulation D thereunder for transactions not involving any public
offering. No general solicitation or advertising occurred in connection with the
issuance and sale of these securities. Such LTIP Units were fully vested upon
issuance, and may convert to OP Units upon reaching capital account equivalency
with the OP Units held by the Company, and may then be redeemed for cash or, at
the option of the Company and after a one year holding period (including any
period during which the LTIP Units were held), settled in shares of the
Company's Class A Common Stock on a one-for-one basis. From the date of grant,
holders of such LTIP Units will be entitled to receive "distribution
equivalents" at the time distributions are paid to the holders of the Company's
Class A Common Stock.
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