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Note 6. Preferred Stock4 - Other Assets

Items included in other assets, net on the Company’s consolidated balance sheets as of March 31, 2020 and Common StockDecember 31, 2019 are detailed in the table below (dollars in thousands):

Stock Split

Receivables due from related parties as of March 31, 2020 and December 31, 2019 are described further in Note 12 “Related Party Transactions”. 

Note 5 – Debt

The table below details the Company’s debt balance at March 31, 2020 and December 31, 2019 (in thousands):

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Basis Term Loan

On December 27, 2019, six of the Company’s subsidiaries, as borrowers (collectively, the “Borrowers”), and Big Real Estate Finance I, LLC, a subsidiary of a real estate fund managed by Basis Management Group, LLC, as lender (the “Basis Lender”), entered into a loan agreement (the “Basis Loan Agreement”) pursuant to which the Basis Lender made a senior secured term loan of up to $66.9 million (the “Basis Term Loan”) to the Borrowers, of which $63.8 million was drawn at closing and was outstanding as of March 31, 2020. Pursuant to the Basis Loan Agreement, the Basis Term Loan is secured by mortgages on the following properties that were acquired in connection with the closing of the Initial Mergers: Coral Hills, Crestview, Dekalb, Midtown Colonial, Midtown Lamonticello and West Broad. The Basis Term Loan matures on January 1, 2023, subject to two one-year extension options, subject to certain conditions. The Basis Term Loan bears interest at a rate equal to the greater of (i) LIBOR plus 3.850% per annum and (ii) 6.125% per annum. The Borrowers have entered into an interest rate cap that effectively caps LIBOR at 3.50% per annum. As of March 31, 2020, the interest rate of the Basis Term Loan was 6.125%.

The Company used the proceeds from the Basis Term Loan to repay indebtedness securing properties acquired in the Initial Mergers and for general corporate purposes, including the payment of certain transaction costs.

The Borrowers’ obligations under the Basis Loan Agreement are guaranteed by the Company and by Michael Z. Jacoby, the Company’s chairman and chief executive officer, and Thomas M. Yockey, a director of the Company. The Company has agreed to indemnify Mr. Yockey for any losses he incurs as a result of his guarantee of the Basis Term Loan.

The Basis Loan Agreement contains certain customary representations and warranties and affirmative negative and restrictive covenants, including certain property related covenants for the properties owned by the Sub-OP, including a requirement that certain capital improvements be made. The Basis Lender has certain approval rights over amendments or renewals of material leases (as defined in the Basis Loan Agreement) and property management agreements for the properties securing the Basis Term Loan.

If (i) an event of default exists, (ii) BSR or any other subsidiary of the Company serving as property manager for one of the secured parties becomes bankrupt, insolvent or a debtor in an insolvency proceeding, or there is a change of control of BSR or such other subsidiary without approval by the Basis Lender, (iii) a default occurs under the applicable management agreement, (iv) the property manager has engaged in fraud, willful misconduct, misappropriation of funds or is grossly negligent with regard to the applicable property, the Basis Lender may require a Borrower to replace BSR or such other subsidiary of the Company as the property manager and hire a third party manager approved by the Basis Lender to manage the applicable property.

The Borrowers are generally prohibited from selling the properties securing the Basis Term Loan and the Company is prohibited from transferring any interest in any of the Borrowers, in each case without consent from the Basis Lender. The Company is prohibited from engaging in transactions that would result in a Change in Control (as defined in the Basis Loan Agreement) of the Company. Under the Basis Loan Agreement, among other things, it is deemed a Change in Control if Michael Z. Jacoby ceases to be the chairman and chief executive officer of the Company and actively involved in the daily activities and operations of the Company and the Borrowers and a competent and experienced person is not approved by the Basis Lender to replace Mr. Jacoby within 90 days of him ceasing to serve in such roles.

The Basis Loan Agreement provides for standard events of default, including nonpayment of principal and other amounts when due, non-performance of covenants, breach of representations and warranties, certain bankruptcy or insolvency events and changes in control. If an event of default occurs and is continuing under the Basis Loan Agreement, the Basis Lender may, among other things, require the immediate payment of all amounts owed thereunder.

In April 2017,addition, if there is a default by the boardCompany under the MVB Loan (as defined below), by Mr. Jacoby under his guarantee of directorsthe MVB Loan or by Mr. Jacoby under a certain personal loan as long as he has pledged OP units as collateral for such loan, and such default has not been waived or cured, then the then majority shareholder approvedBasis Lender will have the right to sweep the Borrowers’ cash account in which collects retains rental payments from the properties securing the Basis Term Loan on a 1daily basis in order for 10 reverse stock split (“Stock Split”the Basis Lender to create a cash reserve that will serve as collateral for the Basis Term Loan.

The Basis Loan Agreement includes a debt service coverage calculation based on the trailing twelve months results which includes an adjustment for tenants that are more than one-month delinquent in paying rent. A debt service coverage ratio below 1.10x is a Cash Trap Trigger Event (as defined in the loan agreement), which gives the Basis Lender the right to institute a cash management period until the trigger is cured. A debt service coverage ratio below 1.05x for two consecutive calendar quarters gives the Basis Lender the right to remove the Company as manager of the properties. The debt service coverage calculation for the twelve months ended December 31, 2020, the first period effective for the Company, was approximately 1.19x.

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Basis Preferred Interest

On December 27, 2019, the Operating Partnership and Big BSP Investments, LLC, a subsidiary of a real estate fund managed by Basis Management Group, LLC (the “Preferred Investor”), entered into an amended and restated operating agreement (the “Sub-OP Operating Agreement”) of the issued and outstanding shares of common stockBroad Street Big First OP LLC (the “Sub-OP”), a subsidiary of the Company. On June 15, 2017,Operating Partnership. Pursuant to the Company filedSub-OP Operating Agreement, among other things, the Preferred Investor committed to make an amendmentinvestment of up to its articles$10.7 million in the Sub-OP, of incorporation withwhich $6.9 million had been funded as of March 31, 2020, in exchange for a 1.0% membership interest in the Delaware Secretary of State effecting the Stock Split. The Stock Split became effective with the Financial Industry Regulatory Authority, Inc. (“FINRA”) on June 20, 2017.

Sub-OP designated as Class A units.

Pursuant to the Stock Split, each outstanding shareSub-OP Operating Agreement, the Preferred Investor is entitled to a cumulative annual return of 14.0% on its initial capital contribution (the “Class A Return”), and the Preferred Investor will be entitled to a 20% return (the “Enhanced Class A Return”) on any capital contribution made to the Sub-OP in excess of the Company’s common stock was automatically exchanged for one - tenth$10.7 million commitment. The Preferred Investor’s interests must be redeemed on or before the earlier of: (i) January 1, 2023 and (ii) the date on which the Basis Term Loan is paid in full (the “Redemption Date”). The Redemption Date may be extended to December 31, 2023 and December 31, 2024, in each case subject to certain conditions, including the payment of a share.fee equal to 0.25% of the Preferred Investor’s net invested capital for the first extension option and a fee of 0.50% of the Preferred Investor’s net invested capital for the second extension option. If the redemption price is paid on or before the Redemption Date, then the redemption price will be equal to (a) all unreturned capital contributions made by the Preferred Investor, (b) all accrued but unpaid Class A Return, (c) all accrued but unpaid Enhanced Class A Return and (d) all costs and other expenses incurred by the Preferred Investor in connection with the enforcement of its rights under the Sub-OP Operating Agreement. Additionally, at the Redemption Date, the Preferred Investor is entitled to an amount equal to (a) the product of (i) the aggregate amount of capital contributions made and (ii) 0.4, less (b) the aggregate amount of Class A return payments made to the Preferred Investor (the “Minimum Multiple Amount”). As of March 31, 2020 and December 31, 2019, the Minimum Multiple Amount was approximately $2.5 million and $2.8 million, respectively, which is included as indebtedness on the consolidated balance sheet.

The Operating Partnership serves as the managing member of the Sub-OP. However, the Preferred Investor has approval rights over certain major decisions (as defined in the Sub-OP Operating Agreement), including, but not limited to, (i) the incurrence of new indebtedness or modification of existing indebtedness by the Sub-OP or its direct or indirect subsidiaries, (ii) capital expenditures over $250,000, (iii) any proposed change to a property directly or indirectly owned by the Sub-OP, (iv) direct or indirect acquisitions of new properties, (v) the sale or other disposition of any property directly or indirectly owned by the Sub-OP, (v) the issuance of additional membership interests in the Sub-OP, (vi) the entry into any new material lease or any amendment to an existing material lease and (vii) decisions regarding the dissolution, winding up or liquidation of the Sub-OP or the filing of any bankruptcy petition by the Sub-OP.

Under certain circumstances, including in the event that the Preferred Investor’s interests are not redeemed on or prior to the Redemption Date (as it may be extended), the Preferred Investor may remove the Operating Partnership as the manager of the Sub-OP and as the manager for each of the property-owning entities held under the Sub-OP.

The obligations of the Operating Partnership under the Sub-OP Operating Agreement are guaranteed by the Company, Mr. Jacoby, the Company’s chairman and chief executive officer, and Mr. Yockey, a director of the Company. The Company has agreed to indemnify Mr. Yockey for any losses he incurs as a result each stockholder now ownsof this guarantee.

The Preferred Investor’s interests in the Sub-OP under the Sub-OP Operating Agreement are mandatorily redeemable, and, as a reduced number of sharesresult, are characterized as indebtedness in the accompanying consolidated financial statements.

MVB Loan

On December 27, 2019, in connection with the closing of the Company’s common stock. The Stock Split affects all stockholders uniformly and does not affect any stockholder’s percentage ownership inInitial Mergers, the Company, or the proportionate voting rightsOperating Partnership and other rightsBSR entered into a loan agreement (the “MVB Loan Agreement”) with MVB Bank, Inc. (“MVB”) with respect to a $6.5 million loan consisting of a $4.5 million term loan (the “MVB Term Loan”) and preferencesa $2.0 million revolving credit facility (the “MVB Revolver”). The MVB Term Loan matures on December 27, 2022 and the MVB Revolver had an original maturity date of December 27, 2020, which has been extended to December 27, 2022 under the terms described below under the heading “—Forbearance Agreements and Debt Amendments”. The MVB Term Loan has a fixed interest rate of 6.75% per annum. The MVB Revolver carries an interest rate of the stockholders, except for adjustments that may result fromgreater of (i) Prime Rate plus 1.5% and (ii) 6.75%.

The Company has no additional availability under the treatmentMVB Term Loan and the MVB Revolver as of fractional shares, which have been rounded to the nearest whole share. March 31, 2020.

The numberMVB Loan Agreement is secured by certain personal property of the Company’s authorized shares of common stock was not affected byCompany, the Stock Split.

Private Placement

From February 10, 2017 through December 31, 2017,Operating Partnership and BSR. In addition, Mr. Jacoby has pledged the Company accepted subscriptions of $1,940,005 for unregistered shares of the Company’s common stock for $1.50and OP units received as consideration in the Initial Mergers as collateral under the MVB Loan Agreement. The obligations of the Company and the Operating Partnership under the MVB Loan Agreement are guaranteed by a sharesubsidiary of the Company and Michael Z. Jacoby, in his individual capacity.

The MVB Loan Agreement contains certain customary representations and warranties and affirmative and negative covenants. The MVB Loan Agreement also requires the Company to maintain (as such terms are defined in the MVB Loan Agreement) (i) a debt service coverage ratio of at least 1.30 to 1.00, (ii) an EBITDA to consolidated funded debt ratio of at least 8.0%, (iii) an aggregate minimum unencumbered cash, including funds available under other lines of credit, of greater than $5.0 million (the “2017 Private Placement”“Minimum Liquidity Requirement”), and (iv) one or more deposit accounts with MVB with an aggregate minimum balance of $3.0 million (the

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“Deposit Requirement”). The issuancesfailure to comply with the Deposit Requirement is not a default under the MVB Loan Agreement but will increase the interest rate under the MVB Term Loan and MVB Revolver by 1.0% until the Deposit Requirement has been satisfied. See “—Forbearance Agreements and Debt Amendments” for amendments to these covenants and compliance dates.

The MVB Loan Agreement provides for standard events of common stock weredefault, including nonpayment of principal and other amounts when due, non-performance of covenants, breach of representations and warranties, certain bankruptcy or insolvency events and changes in control. If an event of default occurs and is continuing under the MVB Loan Agreement, MVB may, among other things, require the immediate payment of all amounts owed thereunder.

Mortgage Indebtedness

In addition to the indebtedness described above, as of March 31, 2020 and December 31, 2019, the Company had approximately $33.4 million and $32.1 million, respectively, of outstanding mortgage indebtedness secured by individual properties. The Hollinswood mortgage, Vista mortgage, and Brookhill mortgage require the Company to maintain a debt service coverage ratio (as such terms are defined in the respective Loan Agreements) of at least 1.40 to 1.00, 1.35 to 1.00 and 1.35 to 1.00, respectively.

Forbearance Agreements and Debt Amendments

During the second quarter of 2020, the lenders for the Company’s mortgage loans secured by the Brookhill, Hollinswood and Vista properties agreed to defer payments of principal and interest for three months, and the lender for the Company’s mortgage loan secured by the Avondale property agreed to require interest-only payments for four months. Additionally, during the second quarter of 2020, the lender under the MVB Loan Agreement agreed to require interest-only payments for three months and deferred covenant tests until March 31, 2021.  Subsequent to the initial payment deferral, during the third quarter of 2020, the Company’s lender for the mortgage loans secured by Hollinswood and Vista agreed to defer payments of principal and interest for another three months. The deferred amounts for the Hollinswood mortgage loan are due in six equal monthly installments beginning in November 2020. The deferred amounts for all other loans will be due at loan maturity.

On June 16, 2020, the Preferred Investor made two additional capital contributions available to the Sub-OP in reliancethe aggregate amount of approximately $2.9 million, which is classified as debt. The two capital contributions consisted of: (i) a $2.4 million capital contribution to the Sub-OP that the Sub-OP contributed to the Borrowers for purposes of making debt service payments under the Basis Loan Agreement and (ii) a $0.5 million capital contribution to the Sub-OP that the Sub-OP contributed to certain of its other property owning subsidiaries for purposes of making debt service payments on Section 4(a)(2)mortgage debt secured by the properties owned by such subsidiaries and making payments of the Securities ActClass A return due to the Preferred Investor pursuant to the Sub-OP Operating Agreement. The Preferred Investor is entitled to a cumulative annual return of 1933 for13.0% on the offer and sale of securities not involving a public offering and Rule 506(b)additional capital contributions. As described below under the Securities Act. Theheading “—2021 Debt Agreements and Modifications,” the Company expects to repay approximately $0.8 million of these funds with the proceeds from the 2017 Private Placement are being used for working capital andVista mortgage refinance. As of the date of these financial statements, there was approximately $1.2 million remaining available to fund operations. In 2017, the Company issued 1,293,334from these capital contributions which is included in restricted cash.  

As described above under the heading “—Merger with MedAmerica Properties Inc.”, in July 2020 the Company completed the Merger to acquire Lamar Station Plaza East, which included the assumption of $2.5 million in debt. Additionally, in connection with the Merger, the Company entered into a loan modification agreement, which increased the maximum principal amount available under the assumed loan agreement to $4.1 million. The loan was in default of the debt service coverage ratio (as defined in the loan agreement) upon the Company’s assumption of the loan agreement. In connection with the loan modification agreement, the lender agreed to forbear enforcement of the event of default subject to the Company’s satisfaction of certain conditions, including (i) execution of a lease agreement with a specified tenant on or before January 1, 2021, (ii) issuance of a certificate of occupancy for a specified tenant on or before January 1, 2021, and (iii) delivery of subordination, nondisturbance and attornment agreements on or before October 2, 2020 for specified tenants. If the Company did not satisfy these conditions the Lender’s forbearance would terminate. The Company did not meet the above conditions. The Company entered into a second loan modification agreement effective November 2020 in which the lender to agreed to forbear enforcement of the events of default subject to the Company’s satisfaction of certain conditions including (i) issuance of a certificate of occupancy for a specified tenant on or before January 31, 2021 and (ii) the specified tenant has taken full possession and occupancy of the space on or before January 31, 2021. The Company met both conditions required by the second loan modification.

In December 2020, the Company entered into an amendment to the MVB Loan Agreement, which extended the maturity date of the MVB Revolver to December 27, 2021 and in March 2021, the Company entered into another amendment to the MVB Loan Agreement which extended the maturity date of the MVB Revolver to December 27, 2022. The amendments also eliminate the revolving nature of the facility, require monthly principal payments as calculated over a 10-year amortization schedule, and require the repayment of $250,000 on each of the following dates (a) the earlier of March 31, 2021 or the closing of the Company’s pending mergers of the Highlandtown and Spotswood properties, (b) the earlier of September 30, 2021 or the closing of the Company’s pending merger of the Greenwood property, (c) March 31, 2022, and (d) September 30, 2022. The $250,000 payment owed by March 31, 2021 has been paid. Additionally, the amendments (i) deferred testing for covenants related to the Deposit Requirement, Minimum Liquidity Requirement and debt service coverage ratio covenant until June 30, 2021, (ii) deferred testing for the covenant related to the Company’s EBITDA to consolidated funded debt ratio until December 31, 2021, (iii) modified the debt service coverage ratio to 1.00 to 1 and (iv) modified the Minimum Liquidity Requirement to $3.0 million.

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As discussed above, due to the COVID-19 pandemic, the Company entered into loan modifications on various debt instruments which deferred principal and interest payments or required interest-only payments for a period ranging from three to six months. Due to the terms of the modifications, the Company determined that some of these modifications met the criteria for troubled debt restructurings under the accounting standards. No gain or loss was recognized as the carrying amount of the original loans were not greater than the undiscounted cash flows of the modified loans. The Company accounted for the change prospectively using the new effective interest rates of the loans.

PPP Loans

On April 20, 2020, a wholly owned subsidiary of the Company entered into a promissory note (the “PPP Note”) with MVB with respect to an unsecured loan of approximately $0.8 million (the “PPP Loan”) pursuant to the Paycheck Protection Program (the “PPP”), which was established under the CARES Act and is administered by the U.S. Small Business Administration (the “SBA”). The PPP Loan bears interest at a rate of 1.0% per year. During the first quarter of 2021, the Company received forgiveness for its entire balance of the PPP Loan from the SBA, which will be recognized as a gain on debt extinguishment in the Company’s statement of operations in 2021.   

On March 18, 2021, a wholly owned subsidiary of the Company entered into a promissory note (the “Second PPP Note”) with MVB with respect to an unsecured loan of approximately $0.8 million (the “Second PPP Loan”) pursuant to the PPP. The Second PPP Loan bears interest at a rate of 1.0% per year. The Second PPP Note contains certain events of default relating to, among other things, failure to make any payment when due and material adverse changes in the borrower’s financial condition. The occurrence of an event of default, following any applicable cure period, would permit MVB to declare the unpaid principal, accrued and unpaid interest and all other amounts payable under the PPP Note to be immediately due and payable.

Under the terms of the CARES Act, PPP loan recipients can apply for and be granted forgiveness for all or a portion of a loan granted under the PPP, with such forgiveness to be determined, subject to limitations, based on the use of the loan proceeds for payment of payroll costs and certain mortgage interest, rent and utility expenses. The terms of any forgiveness may also be subject to further requirements under any regulations and guidelines the SBA may adopt. The Company can provide no assurances that it will obtain forgiveness of the Second PPP Loan in whole or in part. If the Company does not obtain forgiveness it is required to make equal monthly payments of principal and interest to repay the loan in full upon maturity on March 18, 2026.

2021 Debt Agreements and Modifications

In March 2021, the Company completed the refinance of the approximately $8.9 million Vista Shops mortgage loan. The new loan has a principal balance of $11.7 million, matures in June 2023, and carries an interest rate of 3.83% per annum. The Company deposited approximately $1.9 million of the proceeds from the refinance with the Basis Lender. The Company is in negotiations with the Basis Lender as to the application of the deposit which will be applied as follows unless another agreement is made between the Basis lender and the Company: (i) repay approximately $0.8 million of the outstanding principal balance on the capital contributions, which are treated as debt, provided to the Company in June 2020 under the Basis Preferred Interest as described above under the heading “—Forbearance Agreements and Debt Amendments”, (ii) pay off approximately $0.2 million in accrued interest on these funds and (iii) contribute approximately $0.9 million into an escrow account with the Basis Lender which will either be released to us for certain capital expenditures or used to pay down the outstanding principal balance of the capital contributions upon satisfaction of certain conditions.

Deferred Financing Costs and Debt Discounts

The total amount of deferred financing costs associated with the Company’s debt as of March 31, 2020 and December 31, 2019 was $1.3 million, gross ($1.2 million, net) and $1.3 million, gross ($1.3 million, net), respectively. Debt discounts associated with the Company’s debt as of March 31, 2020 and December 31, 2019 was $1.4 million, gross ($1.2 million, net) and $1.3 million, gross ($1.3 million, net), respectively. Deferred financing costs and debt discounts are netted against the debt balance outstanding on the Company’s consolidated balance sheet and will be amortized to interest expense through the maturity date of the related debt.

The Company recognized amortization expense of deferred financing costs and debt discounts, included in interest expense on the consolidated statement of operations, of approximately $0.2 million for the three months ended March 31, 2020. The Company did not recognize any amortization expense of deferred financing costs and debt discounts during the three months ended March 31, 2019.

Interest Rate Cap and Interest Rate Swap Agreements

To mitigate exposure to interest rate risk, the Company entered into an interest rate cap agreement, effective December 27, 2019, on the full $66.9 million Basis Term Loan to cap the variable LIBOR interest rate at 3.5%. The Basis Term Loan bears interest at a rate equal to the greater of (i) LIBOR plus 3.850% per annum and (ii) 6.125% per annum. As of March 31, 2020, the interest rate of the Basis Term Loan was 6.125%. The Company also entered into two interest rate swap agreements on the Hollinswood Loan to fix the interest rate at 4.06%. The swap agreements are effective as of December 27, 2019 on the outstanding balance of $10.2 million and on July 1, 2021 for the additional availability of $3.0 million under the Hollinswood Loan.

The Company recognizes all derivative instruments as assets or liabilities at their fair value in the consolidated balance sheets. The changes in the fair value of the Company’s derivatives, which do not qualify for hedge accounting, are recognized in earnings. For

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the three months ended March 31, 2020, the Company recognized approximately $0.6 million in expense related to fair value adjustments on derivatives. The Company did not have any derivative instruments during the three months ended March 31, 2019.

The fair value of the Company’s derivative financial instruments as of March 31, 2020 and December 31, 2019 was an interest rate cap asset of less than $0.1 million for each period and an interest rate swap liability of approximately $0.8 million and $0.1 million, respectively. The interest rate cap asset is included in Other assets, net and the interest rate swap liability is included in Accounts payable and accrued expenses on the consolidated balance sheet, respectively.

Covenants

The Company’s loan agreements contain customary financial and operating covenants including debt service coverage ratios and aggregate minimum unencumbered cash covenants. As described above under the heading “—Forbearance Agreements and Debt Amendments”, the lender under the MVB Loan Agreement deferred covenant tests until June 30, 2021 and December 31, 2021. As of March 31, 2020, and throughout 2020, the Company was in compliance with all of the covenants under our debt agreements except for the debt service coverage ratio covenant under the Lamar Station Plaza East mortgage which was assumed in July 2020 as described above under the heading “—Forbearance Agreements and Debt Amendments.”

Note 6 - Commitments and Contingencies

Commitments

As detailed in Note 1 under the heading “—Merger with MedAmerica Properties Inc.” there are six Mergers that have not been completed. The Company will issue an aggregate of 10,400,779 shares of common stock and 573,529 OP units as consideration for the additional Mergers. Until the closing of the remaining Mergers, the Company will continue to manage these six properties and earn management fees.

Contingencies

Impact of COVID-19

The Company is closely monitoring the impact of the COVID-19 pandemic on all aspects of its business, including the impact on its tenants and rental revenue. The Company has observed the impact of COVID-19 manifest in the form of temporary closures or significantly limited operations among its tenants, with the exception of tenants operating in certain “essential” businesses, which has resulted, and may in the future result in, a decline in on-time rental payments and increased requests from tenants for temporary rental relief. In some cases, the Company may have to restructure tenants’ long-term rent obligations and may not be able to do so on terms that are as favorable to the Company as those currently in place. In addition, lease renewals and new leasing activity are expected to be adversely impacted as businesses delay executing leases amidst the immediate and uncertain future economic impacts of the COVID-19 pandemic. The extent of the COVID-19 pandemic’s effect on the Company’s future operational and financial performance, financial condition and liquidity will depend on future developments, including the duration and intensity of the pandemic, the timing and effectiveness of COVID-19 vaccines and treatments, the duration of government measures to mitigate the pandemic and how quickly and to what extent normal economic and operating conditions can resume, all of which are uncertain and difficult to predict. Given this uncertainty, the Company cannot accurately predict the effect on future periods, but the Company expects the pandemic and the related government measures to have an adverse impact on its financial condition, liquidity, results of operations and cash flows and the impact could be material.

Beginning in April 2020 and through the date of these financial statements, the Company has entered into lease modifications that deferred approximately $0.4 million of contractual revenue and waived approximately $0.3 million of contractual revenue. To date, the weighted average payback period of deferred rent is approximately seven months which commences at various times beginning in July 2020 through June 2021. Rent deferrals to date may not be indicative of rent deferrals in any future period.

CARES Act

On March 27, 2020, President Trump signed into law the CARES Act, which, among other things, includes provisions relating to refundable payroll tax credits, deferment of employer side social security payments, net operating loss carryback periods, alternative minimum tax credit refunds, modifications to the net interest deduction limitations, increased limitations on qualified charitable contributions, and technical corrections to tax depreciation methods for qualified improvement property.

It also appropriated funds for the SBA PPP loans that are forgivable in certain situations to promote continued employment, as well as Economic Injury Disaster Loans to provide liquidity to small businesses harmed by COVID-19. The Company received funds under the 2017 Private Placement, along with 2,500 sharesPPP as described in Note 5 under the heading (“—PPP Loans”). Additionally, the Company has utilized the deferred payment of common stock under a prior private placement.the employer portions of social security taxes that would otherwise be due from March 27, 2020 through December 31, 2020, without penalty or interest charges.

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Preferred Stock ExchangeLitigation

In April 2017,From time to time, the Company offered our preferred shareholders shares of our common stock in exchange for their Series A cumulative preferred stock (“Preferred Stock”)or its properties may be subject to claims and accumulated preferred dividends outstanding as of December 31, 2016. Pursuant to the offer, each share of Preferred Stock would be exchanged for 20 shares of (post-split) common stock and each dollar of preferred dividend would be exchanged for 0.2 shares of common stock. All preferred shareholders, except one, accepted the offer resultingsuits in the conversionordinary course of 9,875 shares of Preferred Stockbusiness. The Company’s lessees and $301,656 of accumulated preferred dividends into 257,831 shares of common stock, which were issued inborrowers have indemnified, and are obligated to continue to indemnify, the third quarter of 2017. The effective dateCompany against all liabilities arising from the operations of the exchange was June 30, 2017. This exchange resulted in deemed dividends on preferred stock conversionproperties and are further obligated to indemnify it against environmental or title problems affecting the real estate underlying such facilities. The Company is not aware of $148,125.

Subsequent to the reverse stock split, the private placement and the preferred stock exchange, there are 2,610,568 shares of common stock issued and outstanding, consisting of 1,056,903 shares after the reverse stock split, 1,293,334 shares from the private placement, 2,500 shares from a prior year private placement and 257,831 shares from the preferred stock and preferred dividend exchange.

Preferred Stock Dividends

The holder of Preferred Stock is entitled to receive cumulative, non-compounded cash dividends on each outstanding share of Preferred Stock at the rate of 10% of the Issuance Price per annum (“Preferred Dividends”), which began to accrue on January 1, 2010. Preferred Dividends are payable semiannually to the holder of Preferred Stock. Any Preferred Dividends due and unpaid on any Payment Date, whetherpending or not declared by the board of directors, shall accrue with any other due and unpaid Preferred Dividends, regardless of whether there are profits, surplus or other funds ofthreatened litigation that, if resolved against the Company, legally available for paymentwould have a material adverse effect on its consolidated financial condition, results of dividends.operations or cash flows.

Note 7 - Equity  

Substantially all the Preferred stockholders had previously agreed to accept common stock in lieu of cash for payment of Preferred Dividends. In February 2016, the Company issued 29,856 shares of common stock in lieu of $29,249 of Preferred Dividends for those Preferred stockholders who accepted the common stock in lieu of the cash offer. The total accrued but unpaid Preferred Dividends is $27,361 as of March 31, 2019 and December 31, 2018. An additional $11,250 and $10,000 of cumulative Preferred Dividends are undeclared and unaccrued as of March 31, 2019 and December 31, 2018, respectively, and are not included in the balance sheet.

Common Stock

Noncontrolling Interest

As of March 31, 20192020, the Company owned an 88.4% interest in the Operating Partnership and investors in the Broad Street Entities receiving OP units as consideration for the Initial Mergers collectively owned an 11.6% interest in the Operating Partnership. Commencing on the 12-month anniversary of the date on which the OP units were issued, each limited partner of the Operating Partnership (other than the Company) will have the right, subject to certain terms and conditions, to require the Operating Partnership to redeem all or a portion of the OP units held by such limited partner in exchange for cash based on the market price of the Company’s board of directorscommon stock or, at the Company’s option and officers beneficially own 838,060sole discretion, for shares of the Company’s common stock or 32.10%on a one-for-one basis.

2020 Equity Incentive Plan

On January 16, 2020, the board of directors of the outstanding common stock. Included inCompany approved the 838,060 sharesBroad Street Realty, Inc. 2020 Equity Incentive Plan (the “Plan”). Pursuant to the Plan, the Company may issue equity-based awards to directors, officers, employees, independent contractors and other eligible persons. The Plan provides for the grant of stock options, share awards (including restricted stock and restricted stock units), share appreciation rights, dividend equivalent rights, performance awards, annual cash incentive awards and other equity based awards, including LTIP units, which are 351,966 shares owned by Marino Family Holdings LLC controlled by our chairman, Gary O. Marino, and 91,348 shares owned by Banyan Rail Holdings LLC,convertible on a one-for-one basis into OP units. A total of which Mr. Marino is the president and significant stockholder.

Note 7. Earnings (Loss) per Share

The Company excluded from its diluted earnings per share calculation 500 common shares issuable upon conversion of3,620,000 shares of convertible preferredthe Company’s common stock that were outstanding March 31, 2019 and 2018 as well as 70,000 and 60,000 options that were outstanding asare available for issuance under the Plan. Each share subject to an award granted under the Plan will reduce the available shares under the Plan on a one-for-one basis. The Plan is administered by the compensation committee of the Company’s board of directors. As of March 31, 2019 and 2018, respectively, as their inclusion would be anti-dilutive.

Note 8. Stock-Based Compensation

2020, there were no awards outstanding under the Plan.

On August 23, 2017,December 31, 2020, the Company issuedgranted an aggregate of 60,000153,200 restricted shares of common stock options to its directors. The compensation expense related to these grants is approximately $0.1 million and will be recognized over a weighted-average period of one year beginning on the grant date.

Option Awards

In connection with the completion of the Initial Mergers, the Company assumed option awards previously issued to directors and officers. The related stock compensation expense was not material.

On June 11, 2018,officers of MedAmerica. Details of these options for the Company issued an aggregate of 10,000 stock options to a director as compensation for board services. The related stock compensation expense was not material.

three months ended March 31, 2020 are presented in the table below. The Company previously had stockdid not have any option agreements with its directors and officers. Details of options activity is as follows:awards during the three months ended March 31, 2019.