Note 17 — Equity

Preferred Stock. The Series A, B and C preferred stock may not be redeemed by us before February 2018, May 2018 and February 2019, respectively.

Common Stock. In May 2017, we completed a public offering in which we sold 9,500,000 shares of our common stock for $8.05 per share, and received net proceeds of $76.2 million after deducting the underwriting discount and other offering expenses. We used $25.0 million of the proceeds to exercise our option to fully internalize our management team and terminate the existing management agreement with our Former Manager and the remaining amount was used to make investments and for general corporate purposes.

As of September 30, 2017, there were 7,500,000 common shares available under an “At-The-Market” equity offering with JMP Securities LLC.

As of September 30, 2017, we had $323.5 million available under our $500.0 million shelf registration statement that was declared effective by the SEC in July 2016.

Accumulated Other Comprehensive Income. At September 30, 2017, accumulated other comprehensive income was $0.2 million and represents an unrealized gain related to available-for-sale securities. At December 31, 2016, accumulated other comprehensive income was $0.3 million and consisted of a $0.6 million unrealized gain related to available-for-sale securities, partially offset by $0.2 million of net unrealized losses on derivatives designated as cash flow hedges and less than $0.1 million of net deferred losses on terminated interest swaps. See Note 13 — Derivative Financial Instruments for the reclassifications out of accumulated other comprehensive income and into earnings.

Noncontrolling Interest. Noncontrolling interest relates to the 21,230,769 OP Units issued to ACM to satisfy a portion of the Acquisition purchase price. The value of these OP units at the Acquisition date was $154.8 million. Each of these OP Units are paired with one share of our Special Voting Preferred Shares having a par value of $0.01 per share and is entitled to one vote each on any matter submitted for stockholder approval, which represents approximately 25.6% of the voting power of our outstanding stock at September 30, 2017. The OP Units are entitled to receive distributions if and when our Board of Directors authorizes and declares common stock distributions. The OP Units are also redeemable for cash, or at our option, for shares of our common stock on a one-for-one basis.

Distributions. The following table presents dividends declared (on a per share basis) during the nine months ended September 30, 2017:

Common Stock			Preferred Stock
				Dividend (1)
Declaration Date	Dividend		Declaration Date	Series A		Series B		Series C
August 2, 2017	$	0.18	August 2, 2017	$	0.515625	$	0.484375	$	0.53125
May 3, 2017	$	0.18	May 3, 2017	$	0.515625	$	0.484375	$	0.53125
March 1, 2017	$	0.17	February 3, 2017	$	0.515625	$	0.484375	$	0.53125

(1)

The dividend declared on August 2, 2017 was for June 1, 2017 through August 31, 2017, the dividend declared on May 3, 2017 was for March 1, 2017 through May 31, 2017 and the dividend declared on February 3, 2017 was for December 1, 2016 through February 28, 2017.

Common Stock — On November 1, 2017, the Board of Directors declared a cash dividend of $0.19 per share of common stock. The dividend is payable on November 30, 2017 to common stockholders of record as of the close of business on November 15, 2017.

Preferred Stock — On November 1, 2017, the Board of Directors declared a cash dividend of $0.515625 per share of 8.25% Series A preferred stock; a cash dividend of $0.484375 per share of 7.75% Series B preferred stock; and a cash dividend of $0.53125 per share of 8.50% Series C preferred stock. These amounts reflect dividends from September 1, 2017 through November 30, 2017 and are payable on November 30, 2017 to preferred stockholders of record on November 15, 2017.

Deferred Compensation. In March 2017, we issued 299,750 shares of restricted common stock under the 2014 Omnibus Stock Incentive Plan (the “2014 Plan”) to certain employees of ours and our Former Manager with a total grant date fair value of $2.4 million and recorded $0.4 million to employee compensation and benefits and $0.5 million to selling and administrative expense in our consolidated statements of income. One third of the shares vested as of the date of grant, one third will vest in March 2018, and the remaining third will vest in March 2019. In connection with the full integration of our management team and termination of the existing management contract, effective May 31, 2017, all stock compensation previously granted to employees that transferred from our Former Manager (non-employees prior to May 31, 2017) will be recorded to employee compensation and benefits based on the remeasured fair value on May 31, 2017 over the remaining requisite service period. In March 2017, we also issued 74,375 shares of fully vested common stock to the independent members of the Board of Directors under the 2014 Plan and recorded $0.6 million to selling and administrative expense in our consolidated statements of income.

We entered into an amended and restated annual incentive agreement (the “2017 annual incentive agreement”) with our chief executive officer, effective January 1, 2017. The chief executive officer’s annual cash bonus and value of his annual long-term equity awards under the 2017 annual incentive agreement each increased 10% as a result of the Company meeting the equity capitalization growth goals in his previous incentive agreement. In addition, the chief executive officer is also eligible to receive a $3.0 million performance-based award of restricted stock annually for five years subject to meeting certain goals related to the integration of the Acquisition. Each $3.0 million award vests in full three years after the grant date and are subject to the chief executive officer’s continued employment. In August 2017, we granted our chief executive officer 357,569 shares of performance-based restricted stock as a result of the Company meeting the goals related to the integration of the Acquisition. The awards had a grant date fair value of $2.7 million and we recorded $0.1 million to employee compensation and benefits in our consolidated statements of income. All other terms of the 2017 incentive agreement are consistent with the chief executive officer’s previous incentive agreement.

During the first quarter of 2017, we issued 74,830 shares of restricted common stock to our chief executive officer under his 2017 annual incentive agreement with a grant date fair value of $0.6 million and recorded $0.1 million to employee compensation and benefits in our consolidated statements of income. One quarter of the shares vested as of the date of grant and one quarter will vest on each of the first, second and third anniversaries of the date of grant. Our chief executive officer was also granted up to 448,980 performance-based restricted stock units that vest at the end of a four-year performance period based on our achievement of certain total stockholder return objectives. The restricted stock units had a grant date fair value of $1.0 million and we recorded $0.1 million to employee compensation and benefits in our consolidated statements of income.

Earnings Per Share (“EPS”). Basic EPS is calculated by dividing net income attributable to common stockholders by the weighted average number of shares of common stock outstanding during each period inclusive of unvested restricted stock with full dividend participation rights. Diluted EPS is calculated by dividing net income by the weighted average number of shares of common stock outstanding plus the additional dilutive effect of common stock equivalents during each period using the treasury stock method. Our common stock equivalents include the weighted average dilutive effect of performance-based restricted stock units granted to our chief executive officer, OP Units issued in connection with the Acquisition and convertible senior unsecured notes.

The following tables reconcile the numerator and denominator of our basic and diluted EPS computations:

	Three Months Ended September 30, 2017				Three Months Ended September 30, 2016
	Basic		Diluted		Basic		Diluted

Net income attributable to common stockholders (1)	$	16,420,958	$	16,420,958	$	10,888,172	$	10,888,172
Net income attributable to noncontrolling interest (2)	—		5,661,184		—		3,649,432

Net income attributable to common stockholders and nocontrolling interest	$	16,420,958	$	22,082,142	$	10,888,172	$	14,537,604


Weighted average shares outstanding	61,582,796		61,582,796		51,390,467		51,390,467
Dilutive effect of OP Units (2)	—		21,230,769		—		18,230,769
Dilutive effect of restricted stock units (3)	—		1,104,552		—		650,560

Weighted average shares outstanding	61,582,796		83,918,117		51,390,467		70,271,796


Net income per common share (1)	$	0.27	$	0.26	$	0.21	$	0.21

	Nine Months Ended September 30, 2017				Nine Months Ended September 30, 2016
	Basic		Diluted		Basic		Diluted

Net income attributable to common stockholders (1)	$	43,964,070	$	43,964,070	$	22,261,516	$	22,261,516
Net income attributable to noncontrolling interest (2)	—		16,596,415		—		—

Net income attributable to common stockholders and nocontrolling interest	$	43,964,070	$	60,560,485	$	22,261,516	$	22,261,516


Weighted average shares outstanding	56,602,504		56,602,504		51,272,795		51,272,795
Dilutive effect of OP Units (2)	—		21,230,769		—		—
Dilutive effect of restricted stock units (3)	—		1,077,178		—		354,755
Dilutive effect of convertible senior unsecurred notes (4)	—		32,468		—		—

Weighted average shares outstanding	56,602,504		78,942,919		51,272,795		51,627,550


Net income per common share (1)	$	0.78	$	0.77	$	0.43	$	0.43

(1)

Net of preferred stock dividends.

(2)

We consider OP Units to be common stock equivalents as the holder has voting rights, the right to distributions and the right to redeem the OP Units for the cash value of a corresponding number of shares of common stock or a corresponding number of shares of common stock, at our election. For the nine months ended September 30, 2016, the OP Units were considered anti-dilutive and excluded from diluted EPS.

(3)

Mr. Kaufman was granted restricted stock units in 2017, 2016 and 2015 which vest at the end of a four-year performance period based upon our achievement of total stockholder return objectives.

(4)

The convertible senior unsecured notes impact diluted earnings per share if the average price of our common stock exceeds the conversion price, as calculated in accordance with the terms of the indenture.