UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

  

Date of Report (Date of earliest event reported): May 7, 2015

 

Bluerock Residential Growth REIT, Inc.
(Exact Name of Registrant as Specified in Its Charter)

 

Maryland   001-36369   26-3136483
(State or other jurisdiction of incorporation
or organization)
 

(Commission File Number)

 

 

(I.R.S. Employer

Identification No.)

 

712 Fifth Avenue, 9th Floor

New York, NY 10019

(Address of principal executive offices)

 

(212) 843-1601
(Registrant’s telephone number, including area code)

 

None.
(Former name or former address, if changed since last report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 
 

 

ITEM 3.02 UNREGISTERED SALES OF EQUITY SECURITIES.

 

Securities for Services

 

On April 2, 2014, Bluerock Residential Growth REIT, Inc., or the Company, entered into a Management Agreement, or the Management Agreement, with its operating partnership, Bluerock Residential Holdings, L.P., or the Operating Partnership, and its manager, BRG Manager, LLC, or the Manager, pursuant to which the Manager administers the business activities and day-to-day operations of the Company and the Operating Partnership. The Management Agreement provides for the payment of an incentive fee to the Manager, or the Incentive Fee, payable in quarterly installments and calculated by the Manager as set forth in the Management Agreement, which calculation is subject to review by the Company’s board of directors, or the Board. On May 7, 2015, the Manager provided the Board with its calculation of the quarterly installment of the Incentive Fee for the three months ended March 31, 2015, which was reviewed by the Board.

 

Pursuant to the terms of the Management Agreement, one half of each quarterly installment of the Incentive Fee is payable in units of the Operating Partnership’s long-term incentive plan, or LTIP Units, and the remainder of each quarterly installment of the Incentive Fee is payable in either cash or LTIP Units, at the election of the Board. On May 7, 2015, the Board agreed to and approved payment of the quarterly installment of the Incentive Fee for the three months ended March 31, 2015 entirely in LTIP Units.

 

The Board further approved the issuance by the Operating Partnership to the Manager, on May 14, 2015 (five business days following May 7, 2015), or the Issuance Date, of a number of LTIP Units equal to (i) the dollar amount of the portion of the quarterly installment of the Incentive Fee payable in such LTIP Units (calculated by the Manager as $931,402), divided by (ii) the average of the closing prices of the Company’s Class A common stock, $0.01 par value per share, on the NYSE MKT on the five business days prior to the Issuance Date, or the Manager LTIP Units, in payment of the Incentive Fee.

 

The Board authorized the Company, as the General Partner of the Operating Partnership, to cause the Operating Partnership to issue the Manager LTIP Units to the Manager in reliance upon exemptions from registration provided by Section 4(A)(2) of the Securities Act of 1933 and Regulation D. The Manager has a substantive, pre-existing relationship with the Company and is an “accredited investor” as defined in Regulation D.

 

The Manager LTIP Units shall be 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 settled in shares of the Company’s Class A common stock. The Manager will be entitled to receive “distribution equivalents” with respect to the Manager LTIP Units at the same time distributions are paid to the holders of the Company’s Class A common stock.

  

 
 

 

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

  BLUEROCK RESIDENTIAL GROWTH REIT, INC.
     
     
Dated: May 13, 2015 By: /s/ Christopher J. Vohs
    Christopher J. Vohs
    Chief Accounting Officer and Treasurer