Stockholders' Equity

12 Months Ended

Dec. 31, 2019

Stockholders’ EquityUnder the Company’s Articles of Amendment and Restatement (as amended and restated, the “Charter”), the Company has the authority to issue 900,000,000 shares of common stock, $0.01 per share par value, classified and designated as 850,000,000 shares of Class A common stock, 50,000,000 shares of Class T common stock, and 50,000,000 shares of preferred stock with a par value of $0.01 per share. On September 30, 2015, the Company sold 22,100 shares of common stock to Hartman Advisors, LLC at a purchase price of $9.05 per share for an aggregate purchase price of $200,005, which was paid in cash. The Company’s board of directors is authorized to amend the Charter, without the approval of the Company’s stockholders, to increase the aggregate number of authorized shares of capital stock or the number of shares of any class or series that the Company has authority to issue.

Common Stock

Shares of Class A and Class T common stock entitle the holders to one vote per share on all matters which stockholders are entitled to vote, to receive dividends and other distributions as authorized by the Company’s board of directors in accordance with the Maryland General Corporation Law and to all rights of a stockholder pursuant to the Maryland General Corporation Law. Neither Class A or Class T common stock have any preferences or preemptive conversion or exchange rights.

Preferred Stock

The board of directors, with the approval of a majority of the entire board of directors and without any action by the stockholders, may amend the charter from time to time to increase or decrease the aggregate number of authorized shares of capital stock or the number of authorized shares of capital stock of any class or series. If the Company were to create and issue preferred stock or convertible stock with a distribution preference over common stock, payment of any distribution preferences of outstanding preferred stock or convertible stock would reduce the amount of funds available for the payment of distributions on our common stock. Further, holders of preferred stock are normally entitled to receive a preference payment in the event we liquidate, dissolve or wind up before any payment is made to our common stockholders, likely reducing the amount common stockholders would otherwise receive upon such an occurrence. In addition, under certain circumstances, the issuance of preferred stock or a separate class or series of common stock may render more difficult or tend to discourage a merger, tender offer or proxy contest, the assumption of control by a holder of a large block of our securities and the removal of incumbent management.

Stock-Based Compensation

The Company awards vested restricted common shares to non-employee directors as compensation in part for their service as members of the board of directors of the Company. These shares are fully vested when granted. These shares may not be sold while an independent director is serving on the board of directors. For the years ended December 31, 2019 and 2018 the Company granted 2,500 and 2,500 shares, respectively of restricted common stock to independent directors as compensation for services. The Company recognized $29,250 and $25,000 as stock-based compensation expense for the years ended December 31, 2019 and 2018, respectively, based upon the offering price of $11.70 and $10.00 , respectively per common share.

Distributions

The following table reflects total distributions paid in cash and issued in shares of our common stock for the periods indicated:


Period	Cash		DRP & Stock		Total
First Quarter 2019	$	304,955	$	388,228	$	693,183
Second Quarter 2019	387,574		484,395		871,969
Third Quarter 2019	498,717		645,844		1,144,561
Fourth Quarter 2019	745,566		628,561		1,374,127
Total	$	1,936,812	$	2,147,028	$	4,083,840
First Quarter 2018	$	153,832	$	192,202	$	346,034
Second Quarter 2018	182,226		245,363		427,589
Third Quarter 2018	215,317		293,079		508,396
Fourth Quarter 2018	236,895		344,918		581,813
Total	$	788,270	$	1,075,562	$	1,863,832