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Item 5. Market for Registrant’s Common Equity

2023-02-27 compared with 2022-02-28 · 32 added, 38 removed, 10 unchanged (88% of the section changed)

2 unchanged sentences

Our class A common stock is traded on the NYSE under the symbol “DBRG.”

Our class B common stock is not publicly traded, and is described in Note 9 to the consolidated financial statements in Item 15 of this Annual Report.

Holders of Common Equity

On February 21, 2023, there were 2,251 holders of our class A common stock and one holder of our class B common stock (which, in each case, does not reflect the beneficial ownership of shares held in nominee name).

Distributions

Holders of our common stock are entitled to receive distributions if and when the board of directors authorizes and declares distributions.

The board of directors has not established any minimum distribution level.

In order to maintain our qualification as a REIT, we intend to pay dividends to our stockholders that, on an annual basis, will represent at least 90% of our taxable income (which may not necessarily equal net income as calculated in accordance with GAAP), determined without regard to the deduction for dividends paid and excluding any net capital gains.

No distributions can be paid on our class A and class B common stock unless we have paid all cumulative dividends on our outstanding preferred stock.

The Company suspended dividends on its class A common stock beginning with the second quarter of 2020.

Payment of common dividends was previously subject to certain restrictions under the terms of the corporate credit facility, which was terminated in July 2021.

The Company continues to monitor its financial performance and liquidity position, and will reevaluate its dividend policy as conditions improve.

We cannot assure our stockholders that we will make any future distributions.

Dividends paid to stockholders, for income tax purposes, represent distributions of ordinary income, capital gains, return of capital or a combination thereof.

The following table presents the income tax treatment of dividends per share of common and preferred stock.

Common Stock (1)

Preferred Stock (2)

Series B Series E Series G Series H Series I Series J

Return of capital (3)

N/A N/A N/A $ 1.57 $ 1.78 $ 1.79 $ 1.78

Return of capital (3)

$ 0.22 N/A N/A $ 1.87 $ 1.78 $ 1.79 $ 1.78

Ordinary income $ 0.14 $ 0.84 $ 0.89 $ 0.76 $ 0.72 $ 0.73 $ 0.72

Capital gains 0.20 1.22 1.30 1.11 1.06 1.06 1.06

Return of capital (3)

0.10 — — — — — —

Total $ 0.44 $ 2.06 $ 2.19 $ 1.87 $ 1.78 $ 1.79 $ 1.78

(1) Common stock dividends declared in November 2019 and paid in January 2020 were considered distributions in the year paid for federal income tax purposes.

The Company suspended dividends on its class A common stock beginning with the second quarter of 2020.

(2) Distributions on the Company's Series G, H, I and J preferred stock declared in November 2018 and 2019 and paid in January 2019 and 2020, respectively, were considered distributions in the year paid for federal income tax purposes.

(3) Represents dividends paid in excess of our current and accumulated earnings and profit ("E&P"), which is a tax-based measure calculated by making adjustments to taxable income for items that are treated differently for E&P purposes.

A return of capital reduces the basis of a stockholder's investment in our common and/or preferred stock to the extent of such basis.

Distributions of return of capital dividends in excess of a shareholder's basis are treated as capital gains.

Reverse Stock Split

In August 2022, the Company effectuated a one-for-four reverse stock split of its outstanding shares of class A and class B common stock.

The number of authorized shares of common stock was not adjusted in connection with the reverse stock split, however, the Company intends to seek stockholder approval to make a proportional change to the number of authorized shares of class A and class B common stock at its next annual meeting of stockholders.

Par value of common stock was proportionately increased from $0.01 to $0.04 per share.

Throughout this Annual Report, common stock share and per share information, including OP units and stock award units, as well as the Company's senior note conversion or exchange ratio in common stock shares, have been revised for all periods presented to give effect to the reverse stock split.

Holders of our common stock are entitled to receive distributions only if and when our board of directors authorizes and declares distributions.

Our board of directors has not established any minimum distribution level.

No distributions can be paid on our common stock unless we have paid all cumulative dividends on our outstanding preferred stock.

We reinstated quarterly common stock dividends in the third quarter of 2022, having previously suspended common stock dividends for the second quarter of 2020 through the second quarter of 2022.

Common stock dividends were $0.01 per share for each of the third and fourth quarters of 2022.

Recent Sales of Unregistered Securities;

Use of Proceeds from Registered Securities

Exchangeable Notes— In the fourth quarter of 2021, 73,365,420 shares of our class A common stock were issued to certain holders of the 5.75% exchangeable notes upon exchange by such holders of $161.3 million of outstanding principal on the 5.75% exchangeable notes.

No consideration was received by the Company for the exchange.

Redemption of Membership Units in OP ("OP Units") —Holders of OP Units have the right to require the OP to redeem all or a portion of their OP Units for cash or, at our option, shares of our class A common stock on a one-for-one basis.

In the fourth quarter of 2021, in satisfaction of redemption requests by former employee OP Unit holders, 1,500,000 shares of our class A common stock were issued to the former employees.

Such shares of class A common stock were issued in reliance on Section 4(a)(2) of the Securities Act of 1933, as amended.

Purchases of Equity Securities by Issuer and Affiliated Purchasers

Pursuant to a stock repurchase program authorized by our board of directors in July 2022, the Company may repurchase up to $200 million of its outstanding shares of class A common stock and/or preferred stock through various methods, including open market repurchases, negotiated block transactions, accelerated share repurchases, open market solicitations and Rule 10b5-1 plans.

The stock repurchase program expires on June 30, 2023 and may be extended, modified, or discontinued at any time.

The following table presents information related to purchases of the Company's class A common stock during the quarter ended December 31, 2022:

Period Total Number of Shares Purchased Weighted Average Price Paid Per Share Total Number of Shares

Purchased as Part of

Publicly Announced

Program Maximum Approximate

Dollar Value that May

Yet Be Purchased

Under the Program

($ in thousands)

October 1 through October 31, 2022 3,250,450 $ 12.71 3,250,450 $ 92,430

November 1 through November 30, 2022 — — — 92,430

December 1 through December 31, 2022 — — — 92,430

3,250,450 $ 12.71 3,250,450 $ 92,430

(1) Represent stock purchases pursuant to the repurchase program described above.

Stock Performance Graph

The following graph compares the cumulative total return on our class A common stock with the cumulative total returns on the Standard & Poor’s 500 Composite Stock Price Index (the “S&P 500 Index”) and the MSCI US REIT Index, comprising equity REITs ("RMZ Index") from December 31, 2016 to December 31, 2021.

Our stock price in the period preceding the merger among Colony Capital, Inc.

("CLNY") as the Company was formerly known, NorthStar Asset Management Group Inc.

("NSAM") and NorthStar Realty Finance Corp ("NRF") on January 10, 2017 represents the then stock price of CLNY adjusted to reflect the equity structure of NSAM as the legal acquirer by applying the share exchange ratio of one share of CLNY common stock for 1.4663 shares of common stock of the Company after the merger.

The following graph compares the cumulative total return on our class A common stock with the cumulative total returns on the Standard & Poor’s 500 Composite Stock Price Index (“S&P 500”), MSCI US REIT Index ("RMZ"), and Dow Jones U.S.

Asset Managers Index ("DJUSAG") from December 31, 2017 to December 31, 2022.

Beginning 2022, DJUSAG is selected as the most comparable industry index to replace RMZ.

This change is consistent with DBRG's current core business of investment management and with DBRG no longer maintaining REIT status effective 2022.

The graph assumes an investment of $100 in our common stock and each of the indices on December 31, 2017 and the reinvestment of all dividends.

1 unchanged sentence

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 5. Market for Registrant’s Common Equity