Annual report pursuant to Section 13 and 15(d)

Equity

v3.22.0.1
Equity
 12 Months Ended
Dec. 31, 2021
Equity [Abstract]  
Equity EQUITY
Amendment to Articles of Incorporation
On February 20, 2020, we filed with the State Department of Assessments and Taxation of Maryland an Articles Supplementary (i) setting forth the rights, preferences, and terms of the Series C Preferred Stock and (ii) reclassifying and designating 26,000,000 shares of our authorized and unissued shares of common stock as shares of Series C Preferred Stock.
On January 13, 2021, we further amended our articles of incorporation (i) setting forth the rights, preferences, and terms of the Series D Term Preferred Stock and (ii) reclassifying and designating 3,600,000 shares of our authorized and unissued shares of common stock as shares of Series D Term Preferred Stock.
Amendment to Operating Partnership Agreement
In connection with the authorization of the Series C Preferred Stock, the Operating Partnership adopted the Fourth Amendment to its First Amended and Restated Agreement of Limited Partnership (collectively, the “Amendment”), establishing the rights, privileges, and preferences of 6.00% Series C Cumulative Redeemable Preferred Units (the “Series C Preferred OP Units”). The Amendment provides for the Operating Partnership’s establishment and issuance of an equal number of Series C Preferred OP Units as are issued shares of Series C Preferred Stock by the Company in connection with the Series C Offering upon the Company’s contributions to the Operating Partnership of the net proceeds of the Series C Offering. Generally, the Series C
Preferred OP Units provided for under the Amendment have preferences, distribution rights, and other provisions substantially equivalent to those of the Series C Preferred Stock.
On January 13, 2021, we further amended our Operating Partnership agreement in order to establish the rights, privileges, and preferences of 5.00% Series D Cumulative Term Preferred Units (the “Series D Term Preferred Units”). The Amendment provides for the Operating Partnership’s establishment and issuance of an equal number of Series D Term Preferred Units as are issued shares of Series D Term Preferred Stock by the Company in connection with the offering of Series D Term Preferred Stock upon the Company’s contribution to the Operating Partnership of the net proceeds of the offering of Series D Term Preferred Stock. Generally, the Series D Term Preferred Units provided for under the Amendment have preferences, distributions rights, and other provisions substantially equivalent to those of the Series D Term Preferred Stock.
Registration Statement
On March 6, 2020, we filed a universal registration statement on Form S-3 (File No. 333-236943) with the SEC (the “Registration Statement”) to replace our prior universal registration statement. The Registration Statement, which was declared effective by the SEC on April 1, 2020, permits us to issue up to an aggregate of $1.0 billion in securities, consisting of common stock, preferred stock, warrants, debt securities, depository shares, subscription rights, and units, including through separate, concurrent offerings of two or more of such securities. Through December 31, 2021, we had issued a total of 3,503,391 shares of Series C Preferred Stock for gross proceeds of approximately $86.9 million, 2,415,000 shares of Series D Term Preferred Stock for gross proceeds of approximately $60.4 million, and 12,575,252 shares of common stock (excluding 288,303 shares of common stock issued in exchange for certain OP Units that were tendered for redemption) for gross proceeds of approximately $241.2 million under the 2020 Registration Statement.
Equity Issuances
Series B Preferred Stock
On May 31, 2018, we filed a prospectus supplement with the SEC for a continuous public offering of up to 6,000,000 shares (the “Series B Offering”) of our 6.00% Series B Cumulative Redeemable Preferred Stock, par value $0.001 per share (the “Series B Preferred Stock”) at an offering price of $25.00 per share for gross proceeds of up to $150.0 million. The Series B Preferred Stock was offered on a continuous, “reasonable best efforts” basis by Gladstone Securities, the dealer-manager for the Series B Offering.
The Series B Offering was completed on March 9, 2020 (the “Series B Termination Date”), with the full 6,000,000 allotted shares being sold, and, exclusive of redemptions, resulted in total gross proceeds of approximately $147.5 million and net proceeds, after deducting Series B Selling Commissions, Series B Dealer-Manager Fees, and offering expenses payable by us, of approximately $133.4 million. See Note 6, “Related-Party Transactions—Gladstone Securities—Dealer-Manager Agreements,” for a discussion of the fees and commissions paid to Gladstone Securities in connection with the Series B Offering.
During the year ended December 31, 2020, we listed the Series B Preferred Stock on Nasdaq under the ticker symbol “LANDO.” Trading of the Series B Preferred Stock on Nasdaq commenced on October 19, 2020.
Series C Preferred Stock
On April 3, 2020, we filed a prospectus supplement (which superseded and replaced a previously-filed prospectus supplement) with the SEC for a continuous offering (the “Series C Offering”) of up to 26,000,000 shares of our 6.00% Series C Cumulative Redeemable Preferred Stock, par value $0.001 per share (the “Series C Preferred Stock”). The Series C Offering permits us to sell up to 20,000,000 shares (the “Primary Series C Offering”) of our Series C Preferred Stock on a “reasonable best efforts” basis through Gladstone Securities at an offering price of $25.00 per share and up to 6,000,000 shares of our Series C Preferred Stock pursuant to the DRIP at a price of $22.75 per share.
The following table provides information on sales of the Series C Preferred Stock that occurred during the years ended December 31, 2021 and 2020 (dollars in thousands, except per-share amounts):
Years Ended December 31,
2021 2020
Number of shares sold(1)
2,407,027  1,088,315 
Weighted-average offering price per share $ 24.81  $ 24.80 
Gross proceeds $ 59,720  $ 26,987 
Net proceeds(2)
$ 54,760  $ 24,759 
(1)Excludes shares issued pursuant to the DRIP. During the years ended December 31, 2021 and 2020, we issued approximately 7,791 shares and 258 shares, respectively, of the Series C Preferred Stock pursuant to the DRIP.
(2)Net of Series C Selling Commissions, Series C Dealer-Manager Fees, and underwriting discounts.
In addition, during the years ended December 31, 2021 and 2020, 9,920 shares and 138 shares, respectively, of Series C Preferred Stock were tendered for optional redemption, which we satisfied with aggregated cash payments of approximately $248,000 and $3,000, respectively.
As of December 31, 2021, excluding Selling Commissions and Dealer-Manager Fees, we have incurred approximately $704,000 of costs related to the Series C Offering, which are initially recorded as deferred offering costs (included within Other assets, net on the accompanying Consolidated Balance Sheets) and are applied against gross proceeds received from the offering through additional paid-in capital as shares of the Series C Preferred Stock are sold. See Note 6, “Related-Party Transactions—Gladstone Securities—Dealer-Manager Agreements,” for a discussion of the commissions and fees to be paid to Gladstone Securities in connection with the Series C Offering.
The Series C Offering will terminate on the date (the “Series C Termination Date”) that is the earlier of either June 1, 2025 (unless terminated earlier or extended by our Board of Directors), or the date on which all 20,000,000 shares in the Primary Series C Offering are sold. There is currently no public market for shares of the Series C Preferred Stock; however, we intend to apply to list the Series C Preferred Stock on Nasdaq or another national securities exchange within one calendar year after the Series C Termination Date, though there can be no assurance that a listing will be achieved in such timeframe, or at all.
See Note 11, “Subsequent Events—Equity Activity—Equity Issuances—Series C Preferred Stock,” for sales of Series C Preferred Stock completed subsequent to December 31, 2021.
Common Stock
Follow-on Offerings
During the year ended December 31, 2020, we completed a public offering of 1,897,500 shares (including the underwriters’ exercise of the over-allotment option in connection with the offering) of our common stock at a public offering price of $14.40 per share, resulting in gross proceeds of approximately $27.3 million and net proceeds (after deducting underwriting discounts and direct offering expenses borne by us) of approximately $26.1 million.
At-the-Market Program
On August 7, 2015, we entered into equity distribution agreements (commonly referred to as “at-the-market agreements”), as amended from time to time, with Cantor Fitzgerald & Co., Ladenburg Thalmann & Co. Inc., and Virtu Americas LLC (each a “Sales Agent”), under which we were permitted to issue and sell, from time to time and through the Sales Agents, shares of our common stock having an aggregate offering price of up to $30.0 million (the “Prior ATM Program”).
On May 12, 2020, we terminated the Prior ATM Program and entered into new equity distribution agreements with Virtu Americas LLC and Ladenburg Thalmann & Co. Inc., under which we may issue and sell, from time to time and through the current Sales Agents, shares of our common stock having an aggregate offering price up to $100.0 million (the “Current ATM Program.” and collectively with the Prior ATM Program, the “ATM Programs”). On May 18, 2021, we entered into separate amendments to the existing equity distribution agreements to allow us to sell up to $160.0 million of additional shares of our common stock, expanding the aggregate offering price to up to $260.0 million.
The following table provides information on shares of common stock sold by the Sales Agents under the ATM Programs during the years ended December 31, 2021 and 2020 (dollars in thousands, except per-share amounts):
Years Ended December 31,
2021 2020
Number of shares sold 7,990,994  3,096,558 
Weighted-average offering price per share $ 21.70  $ 14.82 
Gross proceeds $ 173,428  $ 45,883 
Net proceeds(1)
$ 171,693  $ 45,424 
(1)Net of underwriting commissions.
Non-Controlling Interests in Operating Partnership
We consolidate our Operating Partnership, which is a majority-owned partnership. As of December 31, 2021 and 2020, we owned approximately 99.4% and 100.0%, respectively, of the outstanding OP Units. As of December 31, 2021 and 2020, there were 204,778 and 0 OP Units held by non-controlling OP Unitholders, respectively.
On or after 12 months after becoming a holder of OP Units, each non-controlling OP Unitholder has the right, subject to the terms and conditions set forth in the partnership agreement of the Operating Partnership, to require the Operating Partnership to redeem all or a portion of such units in exchange for cash or, at the Company’s option, shares of our common stock on a one-for-one basis. The cash redemption per OP Unit would be based on the market price of our common stock at the time of redemption. A limited partner will not be entitled to exercise redemption rights if the delivery of common stock to the redeeming limited partner would breach restrictions on the ownership of common stock imposed under our charter and other limitations thereof.
Regardless of the rights described above, the Operating Partnership will not have an obligation to issue cash to a unitholder upon a redemption request if the Company elects to redeem the OP Units for shares of its common stock. When a non-controlling unitholder redeems OP Units and the Company elects to satisfy that redemption through the issuance of common stock, non-controlling interest in the Operating Partnership is reduced and stockholders’ equity is increased.
During the year ended December 31, 2021, we issued 204,778 OP Units to noncontrolling OP Unitholders representing an aggregate value of approximately $4.0 million, or $19.42 per OP Unit. During the year ended December 31, 2020, we issued 288,303 shares of common stock to satisfy the redemption request of OP Units that were tendered for optional redemption.
The Operating Partnership is required to make distributions on each OP Unit in the same amount as those paid on each share of the Company’s common stock, with the distributions on the OP Units held by the Company being utilized to make distributions to the Company’s common stockholders.
Distributions
The per-share distributions to preferred and common stockholders declared by our Board of Directors during the years ended December 31, 2021 and 2020 are reflected in the table below.
For the Years Ended December 31,
Issuance 2021 2020
Series A Term Preferred Stock(1)(2)
$ 0.181510  $ 1.593750 
Series B Preferred Stock 1.500000  1.500000 
Series C Preferred Stock 1.500000  1.125000 
Series D Term Preferred Stock(1)(3)
1.184031  — 
Common Stock(4)
0.540750  0.537150 
(1)Dividends are treated similar to interest expense on the accompanying Consolidated Statements of Operations and Comprehensive Income.
(2)The Series A Term Preferred Stock was redeemed in full on February 12, 2021.
(3)The Series D Term Preferred Stock was issued on January 19, 2021.
(4)The same amounts were paid as distributions on each OP Unit held by non-controlling OP Unitholders.
For federal income tax characterization purposes, distributions paid to stockholders may be characterized as ordinary income, capital gains, return of capital, or a combination thereof. The characterization of distributions on our preferred and common stock during each of the years ended December 31, 2021 and 2020 is reflected in the following table:
Ordinary
Income		 Return of
Capital		 Long-term
Capital Gain
For the Year Ended December 31, 2021:
Series A Term Preferred Stock 54.534493  % 45.465507  % —  %
Series B Preferred Stock 54.534493  % 45.465507  % —  %
Series C Preferred Stock 54.534493  % 45.465507  % —  %
Series D Term Preferred Stock 54.534493  % 45.465507  % —  %
Common Stock —  % 100.000000  % —  %
For the Year Ended December 31, 2020:
Series A Term Preferred Stock 70.743160  % 29.256840  % —  %
Series B Preferred Stock 70.743160  % 29.256840  % —  %
Series C Preferred Stock 70.743160  % 29.256840  % —  %
Common Stock —  % 100.000000  % —  %