Business Context and Reporting Period
This Form 8-K filing by Broadstone Net Lease, Inc. reports on events occurring on August 31, 2018. The Company is a real estate investment trust focused on net leased properties. The report details the completion of a monthly closing of its ongoing private offering of common stock.
Key Financial Metrics
- Capital Raised: $20,000,000.00 in aggregate proceeds from the August 31, 2018 closing.
- Shares Issued (Private Offering): 237,749.520 shares at a weighted average price of $84.12 per share.
- Shares Issued (DRIP): 54,866.521 shares issued on August 15, 2018, generating $4,462,841.78 in proceeds at $81.34 per share.
- Total Outstanding Common Stock: 20,816,778.509 shares as of August 31, 2018.
- Operating Company Units: 22,553,825.595 units outstanding, with 7.70% held as noncontrolling interests.
- Investment Cap: A $20.0 million monthly cap applies to new and additional investments (excluding DRIP and UPREIT transactions).
Material Changes
The primary material change is the increase in outstanding equity following the August 31 closing. The filing notes a queue of approximately $6,049,797.70 in subscriptions held for subsequent closings, split between shares priced at $83.00 and $85.00. The filing does not provide comparative financial data (revenue, profit, or cash flow) for prior periods as this is a current report on a specific equity event rather than a periodic financial statement.
Outlook, Risks, and Use of Proceeds
- Use of Proceeds: The Company intends to use net proceeds from the closing, supplemented by additional borrowings, to invest in additional net leased properties and for general corporate purposes.
- Regulatory Status: The sale was conducted under the exemption from registration provided by Rule 506(c) under Regulation D.
- Corporate Structure: The Company owns approximately 92.30% of its Operating Company, with the remaining 7.70% held by noncontrolling interests via membership units convertible into common stock.
Investor Verification Checklist
- Verify the current status of the $6.05 million in queued subscriptions and their expected closing dates.
- Confirm the Company's leverage levels and borrowing capacity, as proceeds are intended to be supplemented with debt.
- Review the most recent Forms 10-Q and 10-K for detailed information on the "Determined Share Value" methodology and the equity cap program.
- Assess the impact of the 7.70% noncontrolling interest on future earnings per share calculations.