13. Equity

Preferred Stock

The Company’s 8.0% Series A Cumulative Redeemable Preferred Stock (“Series A Preferred Stock”) ranks senior to the Company’s common stock with respect to dividend rights and rights upon the voluntary or involuntary liquidation, dissolution or winding up of the Company’s affairs. The Company pays cumulative dividends on the Series A Preferred Stock from the date of original issue at a rate of 8.00% per annum of the $25.00 liquidation preference per share (equivalent to the fixed annual rate of $2.00 per share). Dividends on the Series A Preferred Stock are payable quarterly in arrears on or about the 15th day of January, April, July and October of each year.

The Company may not redeem the Series A Preferred Stock prior to February 9, 2017, except in limited circumstances relating to the Company’s ability to qualify as a REIT. On or after February 9, 2017, the Company may, at its option, redeem the Series A Preferred Stock, in whole or in part, at any time or from time to time, for cash at a redemption price of $25.00 per share, plus all accrued and unpaid dividends on such Series A Preferred Stock to, but not including, the date of redemption. The Series A Preferred Stock has no maturity date and is not subject to mandatory redemption or any sinking fund. Holders of shares of the Series A Preferred Stock will generally have no voting rights except for limited voting rights if the Company fails to pay dividends for six or more quarterly periods (whether or not consecutive) and in certain other circumstances.

Common Shares and OP Units

An OP Unit and a share of the Company’s common stock have essentially the same economic characteristics as they share equally in the net income (loss) and distributions of the Operating Partnership. An OP Unit may be tendered for redemption for cash or share of common stock; however, the Company has sole discretion and must have a sufficient amount of authorized common stock to exchange OP Units for shares of common stock on a one-for-one basis.

On January 30, 2015, the Company completed the First CB Closing. In addition to cash consideration exchanged for the additional interests acquired, the Operating Partnership issued to the Sellers an aggregate of 10.4 million OP Units. See Note 6 for more information related to the First CB Closing as well as the Second CB Closing that occurred on April 30, 2015.

As of March 31, 2015, there were 75.5 million common shares and OP Units outstanding, of which 64.7 million, or 85.7%, were owned by the Company and 10.8 million, or 14.3%, were owned by other partners. As of March 31, 2015, the fair market value of the OP Units not owned by the Company was approximately $77.0 million, based on a market value of $7.16 per unit, which was the closing price per share of the Company’s common stock on the New York Stock Exchange on March 31, 2015.

The following is a summary of changes in the shares of the Company’s common stock for the periods shown (in thousands):

	For the Three Months Ended March 31,
	2015		2014
Common shares at beginning of period		64,742		64,502
Issuance of common shares		112		-
Forfeiture of restricted shares		(134)		(15)
Common shares at end of period		64,720		64,487

The following is a summary of changes in the number of OP Units not owned by the Company for the periods shown (in thousands):

	For the Three Months Ended March 31,
	2015		2014
OP Units at beginning of period		401		434
Issuance of OP Units		10,354		-
OP Units at end of period		10,755		434

Dividends and Distributions

During the first quarter of 2015, the Company’s Board of Directors determined, based on an evaluation by management of the Company’s ability to satisfy all financial covenants in the credit agreement for the next four quarters, not to declare or pay dividends on its Common Stock or Series A Preferred Stock for the first quarter of 2015. In addition, the Board does not currently intend to declare or pay dividends on its Common Stock or Series A Preferred Stock for the remainder of 2015 unless the Company experiences sufficient improvement in its operating results, including enhancing its liquidity position by raising additional capital and/or refinancing its existing credit facility. As these dividends were not declared at March 31, 2015, the Company has not accrued them but has included the preferred stock dividends in the calculation of net income (loss) attributable to common shareholders in the accompanying statement of operations and comprehensive income (loss).

For the three months ended March 31, 2014, the Board of Directors declared a first quarter 2014 dividend of $0.165 per share of common stock and OP Unit. The dividends were paid on April 9, 2014, to stockholders of record on March 26, 2014. At March 31, 2014, the Company accrued $10.7 million related to its common stock dividend in accounts payable and accrued expenses in its accompanying consolidated balance sheet.

For the three months ended March 31, 2014, the Board of Directors also declared a cash dividend of $0.50 per share of Series A Preferred Stock for the first quarter of 2014. The preferred stock dividend was paid on April 15, 2014, to stockholders of record on March 26, 2014. At March 31, 2014, the Company accrued $2.5 million related to its preferred stock dividend in accounts payable and accrued expenses in the Company’s accompanying consolidated balance sheet.