SEC Info - Radius Global Infrastructure, Inc.

Six months

ended

Three months

ended

Six months

ended

Revenue

i i 32,568 /

i i 63,167 /

i i 24,973 /

i i 47,145 /

Cost of service

i i 2,027 /

i i 2,868 /

i i 513 /

i i 808 /

Gross profit

i i 30,541 /

i i 60,299 /

i i 24,460 /

i i 46,337 /

Operating expenses:

Selling, general and administrative

i i 21,205 /

i i 43,892 /

i i 18,866 /

i i 34,255 /

Share-based compensation

i i 5,496 /

i i 10,088 /

i i 3,842 /

i i 7,945 /

Amortization and depreciation

i i 19,324 /

i i 38,075 /

i i 15,575 /

i i 29,655 /

Impairment - decommissions

i i 1,272 /

i i 2,037 /

i i 1,707 /

i i 2,394 /

Total operating expenses

i i 47,297 /

i i 94,092 /

i i 39,990 /

i i 74,249 /

Operating loss

( i i 16,756 /

)

( i i 33,793 /

)

( i i 15,530 /

)

( i i 27,912 /

)

Other income (expense):

Realized and unrealized gain (loss) on foreign currency debt

i i 58,667 /

i i 82,899 /

( i i 3,662 /

)

i i 10,945 /

Interest expense, net

( i i 16,714 /

)

( i i 32,812 /

)

( i i 12,267 /

)

( i i 21,254 /

)

Other income (expense), net

( i i 3,164 /

)

( i i 2,072 /

)

i i 266 /

( i i 1,879 /

)

Gain on extinguishment of debt

i i 942 /

—

Total other income (expense), net

i i 39,731 /

i i 48,957 /

( i i 15,663 /

)

( i i 12,188 /

)

Income (loss) before income tax expense (benefit)

i i 22,975 /

i i 15,164 /

( i i 31,193 /

)

( i i 40,100 /

)

Income tax expense (benefit)

( i i 577 /

)

( i i 3,743 /

)

i i 6,144 /

i i 5,422 /

Net income (loss)

i i 23,552 /

i i 18,907 /

( i i 37,337 /

)

( i i 45,522 /

)

Net income (loss) attributable to noncontrolling interest

i i 1,385 /

i i 1,177 /

( i i 2,815 /

)

( i i 3,421 /

)

Net income (loss) attributable to stockholders

i i 22,167 /

i i 17,730 /

( i i 34,522 /

)

( i i 42,101 /

)

Stock dividend payment to holders of Series A Founders Preferred Stock

( i i 40,832 /

)

( i i 40,832 /

)

—

( i i 31,391 /

)

Net loss attributable to common stockholders

( i i 18,665 /

)

( i i 23,102 /

)

( i i 34,522 /

)

( i i 73,492 /

)

Loss per common share:

Basic and diluted

( i i 0.20 /

)

( i i 0.25 /

)

( i i 0.50 /

)

( i i 1.15 /

)

Weighted average common shares outstanding:

Basic and diluted

i i 93,506,412 /

i i 92,809,563 /

i i 68,724,275 /

i i 64,127,528 /

See accompanying notes to condensed consolidated financial statements.

RADIUS GLOBAL INFRASTRUCTURE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited)

(in thousands)

Three months

ended

Six months

ended

Three months

ended

Six months

ended

Net income (loss)

i 23,552

i 18,907

( i 37,337

)

( i 45,522

)

Other comprehensive income (loss):

Foreign currency translation adjustment

( i 63,046

)

( i 77,968

)

i 4,654

( i 9,648

)

Comprehensive loss

( i 39,494

)

( i 59,061

)

( i 32,683

)

( i 55,170

)

See accompanying notes to condensed consolidated financial statements.

RADIUS GLOBAL INFRASTRUCTURE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited)

(in thousands, except share amounts)

Three months ended June 30, 2022 and 2021

Series A Founder

Preferred Stock

Series B Founder

Preferred Stock

Common Shares

Class B Shares

Additional

Accumulated

other

Total

Amount

paid-in

capital

comprehensive

income (loss)

Accumulated

deficit

Noncontrolling

interest

stockholders'

equity

Balance at March 31, 2022

i 1,600,000

i 1,386,033

i 92,731,191

i 9

i 12,657,689

i 1,043,420

( i 42,706

)

( i 282,569

)

i 50,617

i 768,771

Issuance of shares as stock dividend to holders of Series A Founder Preferred Stock

i 2,523,472

i 138,005

—

Exercise of stock options

i 22,300

i 1

i 171

i 172

Share-based compensation

i 5,496

Foreign currency translation adjustment

( i 63,046

)

( i 63,046

)

Net income

i 22,167

i 1,385

i 23,552

Balance at June 30, 2022

i 1,600,000

i 1,386,033

i 95,276,963

i 10

i 12,795,694

i 1,049,087

( i 105,752

)

( i 260,402

)

i 52,002

i 734,945

Balance at March 31, 2021

i 1,600,000

i 1,386,033

i 61,212,042

i 11,611,769

i 678,058

i 1,466

( i 220,816

)

i 54,976

i 513,684

Issuance of common shares

i 14,457,588

i 8

i 201,873

i 201,881

Equity issuance costs

( i 8,539

)

( i 8,539

)

Exercise of warrants

i 832

i 9

Exercise of stock options

i 14,400

i 130

Share-based compensation

i 3,842

Foreign currency translation adjustment

i 4,654

Net loss

( i 34,522

)

( i 2,815

)

( i 37,337

)

Balance at June 30, 2021

i 1,600,000

i 1,386,033

i 75,684,862

i 8

i 11,611,769

i 875,373

i 6,120

( i 255,338

)

i 52,161

i 678,324

See accompanying notes to condensed consolidated financial statements.

Six months ended June 30, 2022 and 2021

Series A Founder

Preferred Stock

Series B Founder

Preferred Stock

Common Shares

Class B Shares

Additional

Accumulated

other

Total

Amount

paid-in

capital

comprehensive

income (loss)

Accumulated

deficit

Noncontrolling

interest

stockholders'

equity

Balance at January 1, 2022

i 1,600,000

i 1,386,033

i 92,159,612

i 9

i 11,551,769

i 1,038,740

( i 27,784

)

( i 278,132

)

i 50,825

i 783,658

Issuance of shares as stock dividend to holders of Series A Founder Preferred Stock

i 2,523,472

i 138,005

—

Exercise of stock options

i 33,285

i 1

i 259

i 260

Share-based compensation

i 560,594

i 1,105,920

i 10,088

Foreign currency translation adjustment

( i 77,968

)

( i 77,968

)

Net income

i 17,730

i 1,177

i 18,907

Balance at June 30, 2022

i 1,600,000

i 1,386,033

i 95,276,963

i 10

i 12,795,694

i 1,049,087

( i 105,752

)

( i 260,402

)

i 52,002

i 734,945

Balance at January 1, 2021

i 1,600,000

i 1,386,033

i 58,425,000

i 11,414,030

i 673,955

i 15,768

( i 213,237

)

i 55,582

i 532,068

Issuance of shares as stock dividend to holders of Series A Founder Preferred Stock

i 2,474,421

i 197,739

—

Issuance of common shares

i 14,457,588

i 8

i 201,873

i 201,881

Equity issuance costs

( i 8,539

)

( i 8,539

)

Exercise of warrants

i 932

i 9

Exercise of stock options

i 17,000

i 130

Share-based compensation

i 309,921

i 7,945

Foreign currency translation adjustment

( i 9,648

)

( i 9,648

)

Net loss

( i 42,101

)

( i 3,421

)

( i 45,522

)

Balance at June 30, 2021

i 1,600,000

i 1,386,033

i 75,684,862

i 8

i 11,611,769

i 875,373

i 6,120

( i 255,338

)

i 52,161

i 678,324

See accompanying notes to condensed consolidated financial statements.

RADIUS GLOBAL INFRASTRUCTURE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

(in thousands)

	Six months ended June 30, 2022			Six months ended June 30, 2021
Cash flows from operating activities:
Net income (loss)	$	i 18,907		$	( i 45,522	)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Amortization and depreciation		i 38,075			i 29,655
Amortization of finance lease and telecom real property interest liabilities discount		i 733			i 649
Impairment – decommissions		i 2,037			i 2,394
Realized and unrealized gain on foreign currency debt		( i 82,899	)		( i 10,945	)
Amortization of debt discount and deferred financing costs		i 2,715			i 514
Provision for bad debt expense		i 207			i 2
Share-based compensation		i 10,088			i 7,945
Deferred income taxes		( i 5,626	)		i 3,453
Gain on extinguishment of debt		( i 942	)		—
Change in assets and liabilities:
Trade receivables, net		( i 881	)		i 296
Prepaid expenses and other assets		( i 507	)		( i 531	)
Accounts payable, accrued expenses and other long-term liabilities		i 5,483			i 3,620
Rent received in advance		i 2,414			i 5,241
Net cash used in operating activities		( i 10,196	)		( i 3,229	)

Cash flows from investing activities:
Investments in real property interests and related intangible assets		( i 259,721	)		( i 223,239	)
Advance deposits made for real property interest investments		( i 22,686	)		—
Purchases of property and equipment		( i 195	)		( i 338	)
Net cash used in investing activities		( i 282,602	)		( i 223,577	)

Cash flows from financing activities:
Borrowings under debt agreements		i 427,003			i 168,940
Repayments of term loans and other debt		( i 112,129	)		( i 95	)
Debt issuance costs		( i 12,571	)		( i 3,852	)
Proceeds from issuance of common stock, net of issuance costs		—			i 191,461
Proceeds from exercises of stock options and warrants		i 260			i 139
Repayments of finance lease and telecom real property interest liabilities		( i 7,407	)		( i 7,687	)
Net cash provided by financing activities		i 295,156			i 348,906

Net change in cash and cash equivalents and restricted cash		i 2,358			i 122,100

Effect of change in foreign currency exchange rates on cash, cash equivalents and restricted cash		( i 19,208	)		( i 740	)

Cash and cash equivalents and restricted cash at beginning of period		i 632,193			i 215,448
Cash and cash equivalents and restricted cash at end of period	$	i 615,343		$	i 336,808

Supplemental disclosure of cash and non-cash transactions:
Cash paid for interest	$	i 30,063		$	i 19,567
Cash paid for income taxes	$	i 1,371		$	i 1,449

See accompanying notes to condensed consolidated financial statements.

RADIUS GLOBAL INFRASTRUCTURE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(in thousands, except share and per share amounts and unless otherwise disclosed)

1.	Organization

Radius Global Infrastructure, Inc. (together with its subsidiaries, “Radius” and/or the “Company”) is a holding company that, as of June 30, 2022, owned approximately i 94% of APW OpCo LLC (“APW OpCo”), which is the parent of AP WIP Investments Holdings, LP (“AP Wireless”), one of the largest international aggregators of rental streams underlying wireless and other essential communications infrastructure sites through the acquisition of telecom real property interests and contractual rights. The Company typically purchases, primarily for a lump sum, the right to receive future rental payments generated pursuant to an existing lease (and any subsequent lease or extension or amendment thereof) between a property owner and an owner of a wireless tower, antennae or other communications infrastructure (each such lease, a “Tenant Lease”). Typically, the Company acquires the rental stream by way of a purchase of a real property interest in the land underlying the wireless tower antennae or other real property related communications infrastructure. These are most commonly easements, usufructs, leasehold and sub-leasehold interests, or fee simple interests, each of which provides the Company the right to receive the rents from the Tenant Lease. In addition, the Company purchases contractual interests, such as an assignment of rents, either in conjunction with the property interest or as a stand-alone right.

/ i

2.	Basis of Presentation and Summary of Significant Accounting Policies

Basis of Presentation and Principles of Consolidation

The accompanying condensed consolidated financial statements include the accounts of the Company and its majority-owned or controlled subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The condensed consolidated financial statements included herein have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and the rules and regulations of Securities and Exchange Commission for interim reporting. The financial information included herein is unaudited. However, the Company believes that all adjustments, which are of a normal and recurring nature, considered necessary for a fair presentation of its financial position and results of operations for such periods have been included herein. The condensed consolidated financial statements and related notes should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 (the “Annual Report”). The results of operations for the three and six months ended June 30, 2022 are not necessarily indicative of the results that may be expected for the entire year.

Use of Estimates

The preparation of the condensed consolidated financial statements, in conformity with GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Significant Accounting Policies

The Company’s significant accounting policies are described in detail in Note 2 to the Company’s consolidated financial statements included in the Annual Report. There have been no material changes to the Company’s significant accounting policies during the six months ended June 30, 2022.

3. Cash, Cash Equivalents and Restricted Cash

The Company is required to maintain cash collateral at certain financial institutions. These include amounts that are required to be held in escrow accounts, which, subject to certain conditions, are available to the Company under certain of its long-term debt agreements. Accordingly, these balances contain restrictions as to their availability and usage and are classified as restricted cash in the condensed consolidated balance sheets. i The reconciliation of cash and cash equivalents and restricted cash reported within the applicable balance sheet that sum to the total of the same such amounts shown in the condensed consolidated statements of cash flows is as follows:

	June 30, 2022		December 31, 2021
Cash and cash equivalents	$	i 488,479	$	i 456,146
Restricted cash		i 2,159		i 2,085
Restricted cash, long term		i 124,705		i 173,962
Total cash and cash equivalents and restricted cash	$	i 615,343	$	i 632,193

/ i

4.	Real Property Interests

Real property interests, net consisted of the following:

	June 30, 2022			December 31, 2021
Right-of-use assets – finance leases	$	i 342,884		$	i 319,457
Telecom real property interests		i 1,430,828			i 1,257,373
		i 1,773,712			i 1,576,830
Less accumulated amortization:
Right-of-use assets - finance leases		( i 23,202	)		( i 17,592	)
Telecom real property interests		( i 104,974	)		( i 83,187	)
Real property interests, net	$	i 1,645,536		$	i 1,476,051

The Company’s real property interests typically consist of leasehold interests or fee simple interests, acquired either through an upfront payment or on an installment basis from property owners who have leased their property to companies that own telecommunications infrastructure assets. The agreements that provide for the leasehold interests typically are easement agreements or similar arrangements, which provide the Company with certain beneficial rights, but not obligations, with respect to the underlying Tenant Leases. The beneficial rights acquired principally include the right to receive the rental income related to the lease with the in-place tenant, and in certain circumstances, additional rents. In most cases, the stated term of the leasehold interest is longer than the remaining term of the in-place Tenant Lease, which provides the Company with the right and opportunity for renewals and extensions. In cases in which the Company acquires a leasehold interest, the Company is both a lessor and a lessee. Although the Company has the rights under the acquired leasehold interests over the duration of the entire term, the underlying tenant, in most cases, can terminate their lease acquired by the Company within a short time frame ( i 30 to i 180 day notice) without penalty. Similarly, when the Company acquires a fee simple interest, the beneficial rights associated with the in-place Tenant Leases are acquired and the Company owns the property underlying or containing the telecommunication infrastructure assets.

The costs of acquiring a real property interest are recorded either as a right-of-use asset, if the arrangement is determined to be a lease at the inception of the agreement under Accounting Standards Codification (“ASC”) Topic 842, Leases (“ASC 842”), or as a telecom real property interest asset, if the acquisition meets the definition of an asset acquisition. Telecom real property interests and finance lease right of use assets are stated at cost less accumulated amortization, and amortization is computed using the straight-line method over their estimated useful lives. Finance lease right-of-use assets are amortized over the lesser of the lease term or the estimated useful life of the underlying asset associated with the leasing arrangement.

The Company often closes and funds its real property interest prepayment transactions through third‑party intermediaries that generally are the Company’s retained legal counsel in each jurisdiction. Funds for these transactions are typically deposited with the intermediary, which releases the funds once all closing conditions are satisfied. In other circumstances, the Company deposits monies with the owners of the sites in advance of consummating the acquisition

of the real property interest, at which time all conditions are satisfied and remaining payments are made. Amounts held by others as deposits at June 30, 2022 and December 31, 2021 totaled $ i 24,817 and $ i 2,307, respectively, and were recorded as other long‑term assets in the Company’s condensed consolidated balance sheets.

In connection with the acquisition of certain real property interest assets expected to occur after June 30, 2022, deposits were required to be paid to the selling entities totaling $ i 20,722, in order to secure the Company’s right to acquire the assets. Upon the acquisition’s closing, the balance of the deposit will be included as part of the aggregate acquisition consideration to be paid for the assets and recorded as real property interest assets.

Right-Of-Use Assets – Finance Leases and Related Liabilities

For a real property interest arrangement determined to be a lease, the Company records a right-of-use asset and a lease liability. The weighted-average remaining lease term for leases classified as finance leases was i 40.3 years and i 40.1 years as of June 30, 2022 and December 31, 2021, respectively. i The Company recorded finance lease expense and interest expense associated with finance lease liabilities in the condensed consolidated statements of operations as follows:

Three months

ended

Six months

ended

Three months

ended

Six months

ended

Finance lease expense

i 3,238

i 6,836

i 2,852

i 5,243

Interest expense – lease liability

i 261

i 517

i 240

i 425

The Company’s lease agreements do not state an implicit borrowing rate; therefore, an internal incremental borrowing rate was determined based on information available at the lease commencement date for the purposes of determining the present value of lease payments. The incremental borrowing rate reflects the cost to borrow on a securitized basis in each geographical market. The weighted-average incremental borrowing rate was i 4.1% and i 3.9% as of June 30, 2022 and December 31, 2021, respectively.

Supplemental cash flow information related to finance leases for the respective periods was as follows:

	Six months ended June 30, 2022		Six months ended June 30, 2021
Cash paid for amounts included in the measurement of finance lease liabilities:
Operating cash flows from finance leases	$	i 263	$	i 149
Financing cash flows from finance leases	$	i 5,209	$	i 4,769
Finance lease liabilities arising from obtaining right-of-use assets	$	i 6,179	$	i 6,770

Telecom Real Property Interests and Related Liabilities

For acquisitions of real property interests accounted for under the acquisition method of accounting, the recorded amount of the telecom real property interest asset represents allocation of the purchase price based on the contractual cash flows associated with the Tenant Lease, including rights and opportunities for renewals thereof.

Under certain circumstances, the contractual payments for the acquired telecom real property interests are made to property owners on a noninterest-bearing basis over a specified period of time. Included in telecom real property interest liabilities in the condensed consolidated balance sheets, the liabilities associated with telecom real property interests were initially measured at the present value of the unpaid payments.

For telecom real property interests, amortization expense was $ i 15,755 and $ i 12,216 for the three months ended June 30, 2022 and 2021, respectively, and $ i 30,300 and $ i 23,415 for the six months ended June 30, 2022 and 2021, respectively. i As of June 30, 2022, amortization expense to be recognized for each of the succeeding five years was as follows:

Remainder of 2022	$	i 34,574
2023		i 68,123
2024		i 68,123
2025		i 67,452
2026		i 67,451
Thereafter		i 1,020,131
	$	i 1,325,854

Maturities of finance lease liabilities and telecom real property interest liabilities as of June 30, 2022 were as follows:

	Finance Lease			Telecom Real Property Interest
Remainder of 2022	$	i 5,851		$	i 1,522
2023		i 12,328			i 8,081
2024		i 6,442			i 3,533
2025		i 4,340			i 393
2026		i 3,072			i 361
Thereafter		i 4,565			i 570
Total lease payments		i 36,598			i 14,460
Less amounts representing future interest		( i 2,613	)		( i 526	)
Total liability		i 33,985			i 13,934
Less current portion		( i 11,749	)		( i 5,384	)
Non-current liability	$	i 22,236		$	i 8,550

As of June 30, 2022, the weighted-average remaining contractual payment term for finance leases was i 3.2 years.

5.	Intangible Assets

Intangible assets subject to amortization consisted of the following:


	June 30, 2022			December 31, 2021
In-place lease intangible asset
Gross carrying amount	$	i 11,562		$	i 10,295
Less accumulated amortization:		( i 2,805	)		( i 2,381	)
Intangible assets, net	$	i 8,757		$	i 7,914

Amortization expense was $ i 353 and $ i 306 for the three months ended June 30, 2022 and 2021, respectively, and $ i 708 and $ i 615 for the six months ended June 30, 2022 and 2021, respectively. The Company reviewed the portfolio of real property interests and intangible assets for impairment, in which the Company identified wireless communication sites for which impairment charges were recorded in Impairment – decommissions in the condensed consolidated statements of operations.

As of June 30, 2022, the intangible asset amortization expense to be recognized for each of the succeeding five years was as follows:

Remainder of 2022	$	i 731
2023		i 1,320
2024		i 1,146
2025		i 993
2026		i 887
Thereafter		i 3,680
	$	i 8,757

/ /

6.	Accounts Payable and Accrued Expenses

Accounts payable and accrued expenses consisted of the following:


	June 30, 2022		December 31, 2021
Interest payable	$	i 10,429	$	i 8,805
Accrued liabilities		i 4,577		i 923
Taxes payable		i 12,560		i 11,980
Payroll and related withholdings		i 6,337		i 7,961
Accounts payable		i 4,784		i 1,891
Professional fees accrued		i 3,444		i 3,428
Current portion of operating lease liabilities		i 874		i 850
Other		i 1,343		i 1,157
Total accounts payable and accrued expenses	$	i 44,348	$	i 36,995

/ i

Debt

Long-term debt, net of unamortized debt discount and deferred financing costs, consisted of the following:


	June 30, 2022			December 31, 2021
DWIP Subscription Agreement	$	i 165,000		$	—
ArcCo Subscription Agreement		i 235,479			—
Facility Agreement		i 620,488			i 681,747
Subscription Agreement		i 157,053			i 169,119
Convertible Notes		i 264,500			i 264,500
DWIP II Loan Agreement		i 75,000			i 75,000
DWIP Loan Agreement		—			i 102,600
Other debt		—			i 2,565
Less: unamortized debt discount and financing fees		( i 36,485	)		( i 23,306	)
Debt, carrying amount	$	i 1,481,035		$	i 1,272,225

ArcCo Subscription Agreement

In December 2021, AP WIP ArcCo Investments, LLC (“ArcCo Investments”), a subsidiary of AP Wireless, entered into a subscription agreement (the “ArcCo Subscription Agreement”) providing for loans of up to € i 750,000. The ArcCo Subscription Agreement provides for funding to ArcCo Investments, the sole borrower thereunder, in the form of promissory certificates consisting of tranches in Euros, Pound Sterling, and U.S. Dollars.

The ArcCo Subscription Agreement contains certain financial condition and testing covenants (such as interest coverage and leverage limits) as well as restrictive and operating covenants relating to, among others, future indebtedness and liens and other material activities of ArcCo Investments and its affiliates. Obligations under the Subscription Agreement are guaranteed by AP WIP Investments, LLC (“AP WIP Investments”), a subsidiary of AP Wireless, and secured by a debt service reserve account and escrow cash account of ArcCo Investments available for making of incremental asset acquisitions, as well as secured by direct equity interests and bank accounts of ArcCo Investments and certain other subsidiaries.

In January 2022, ArcCo Investments borrowed € i 225,000 ($ i 257,490 USD equivalent) of the amount available under the ArcCo Subscription Agreement. Net of an issue discount of approximately $ i 1,287, the funded amount of the borrowing under the ArcCo Subscription Agreement was approximately $ i 256,203. In connection with this borrowing, $ i 5,000 was funded to the debt service reserve account. The initial borrowing accrues interest at a fixed annual rate of approximately i 3.2%, which will be payable i quarterly and is scheduled to mature in January 2030.

Convertible Notes

In September 2021, the Company issued convertible notes (the “Convertible Notes”) in an aggregate principal amount totaling $ i 264,500. The Convertible Notes bear interest at a fixed rate of i 2.5% per year, i payable i semi-annually in arrears on March 15 and September 15 of each year / , beginning on i March 15, 2022. The Convertible Notes are convertible into cash, shares of the Company’s Class A Common Stock, or a combination thereof, at the Company’s election, and may be settled as described below. The Convertible Notes will mature on i September 15, 2026 (the “Maturity Date”), unless earlier repurchased, redeemed or converted in accordance with their terms.

Prior to the close of business on the business day immediately preceding March 15, 2026, the Convertible Notes will be convertible at the option of the holders only under certain conditions and during certain periods. On or after March 15, 2026, until the close of business on the second scheduled trading day immediately preceding the Maturity Date, holders may convert their Convertible Notes, at their option, at the conversion rate then in effect, irrespective of these conditions. At the date of issuance, the conversion rate for the Convertible Notes was i 44.2087 shares of Class A Common Stock per i one thousand dollars principal amount of Convertible Notes (equivalent to an initial conversion price of approximately $ i 22.62 per share of Class A Common Stock).

DWIP Subscription Agreement & DWIP Loan Agreement Repayment

In April 2022, a subsidiary of the Company, AP WIP Holdings, LLC (“DWIP”) entered into a subscription agreement (the “DWIP Subscription Agreement”) providing for the issuance of promissory certificates of up to $ i 165,000. The monthly fixed coupon rate under the DWIP Subscription Agreement is approximately i 3.6% per annum. In connection with entering into the DWIP Subscription Agreement, DWIP borrowed $ i 165,000, using $ i 102,600 to repay all of its outstanding obligations under the DWIP Loan Agreement, dated as of August 12, 2014, as amended (the “DWIP Loan Agreement”), plus the prepayment premium of i 1.0% due thereunder, resulting in the total amount paid to settle the obligation due under the DWIP Loan Agreement of $ i 103,626. Including the unamortized premium of $ i 2,117 recorded in unamortized debt discount and financing fees in the condensed consolidated balance sheet, the carrying amount of the recorded debt under the DWIP Loan Agreement was $ i 104,717 as of the repayment date. Accordingly, the settlement of all obligations under the DWIP Loan Agreement resulted in a gain on extinguishment of debt of $ i i 1,091 / for the three and six months ended June 30, 2022.

Borrowings under the DWIP Subscription Agreement are scheduled to mature in April 2027. Under the DWIP Subscription Agreement, escrow and collection account balances are required to be maintained and each are included in restricted cash in the condensed consolidated balance sheets.

Facility Agreement (up to £1,000,000)

A subsidiary of the Company, AP WIP International Holdings, LLC (“IWIP”), is the sole borrower under a facility agreement (the “Facility Agreement”) that provides for up to £ i 1,000,000 of borrowings with an initial i 10-year term. The Facility Agreement is uncommitted and has the objective of issuing notes that may be denominated in U.S. Dollars, Pound Sterling, Euros, Australian Dollars, or Canadian Dollars. Under the Facility Agreement, debt service reserve and escrow cash account balances are required to be maintained and each are included in restricted cash in the condensed consolidated balance sheets.

Through June 30, 2022, cumulative IWIP borrowings under the Facility Agreement consisted of € i 327,150 and £ i 228,700 that accrue interest at annual fixed rates ranging from i 2.8% to i 4.5%. Outstanding principal amounts due under the Facility Agreement as of June 30, 2022 totaling $ i 332,460, $ i 145,373 and $ i 142,654 are scheduled to mature in October 2027, August 2030 and October 2031, respectively. Principal balances under the Facility Agreement may be prepaid in whole on any date, subject to the payment of any make-whole provision (as defined in the Facility Agreement).

DWIP II Loan Agreement

AP WIP Domestic Investment II, LLC (“DWIP II”), a wholly owned subsidiary of AP WIP Investments, is the sole borrower under a junior loan agreement (the “DWIP II Loan Agreement”), the borrowings under which bear interest at i 6.0%. In May 2022, the Company repaid $ i 5,800, which represented the principal amount owed to one of the lenders under the DWIP II Loan Agreement and resulted in the extinguishment of this borrowing. The carrying amount of the repaid borrowing, including unamortized deferred financing costs, was $ i 5,724. Accordingly, the Company recorded a loss on extinguishment of debt totaling $ i 76. Separately, the Company and the remaining lender amended the DWIP II Loan Agreement, resulting in the receipt of proceeds of $ i 5,800 and a change in the maturity date from April 2023 to April 2024.

Subscription Agreement (up to £250,000)

AP WIP Investments Borrower, LLC, a subsidiary of AP WIP Investments, is the borrower under a subscription agreement (the “Subscription Agreement”) that provides for funding up to £ i 250,000 in the form of nine-year term junior loans consisting of tranches available in Euros, Pound Sterling and U.S. Dollars, and requires a portion of the funding to be held in a debt service reserve account, which is presented in restricted cash in the condensed consolidated balance sheets.

Through June 30, 2022, cumulative borrowings under the Subscription Agreement consisted of fixed and variable rate interest-only notes totaling € i 105,000 and € i 40,000, respectively. As of June 30, 2022, borrowings under the Subscription Agreement bear cash-pay interest at rates ranging from i 3.8% to i 4.25% plus payment-in-kind interest at rates ranging from i 1.75% to i 2.0% and are scheduled to mature in November 2028. Interest payable in cash is paid quarterly, whereas payment-in-kind interest accrues to the principal balance and is payable upon repayment of principal. Principal balances under the Subscription Agreement may be prepaid in whole on any date, subject to the payment of any applicable prepayment fee.

Interest Rate Cap Agreement

Interest on the variable rate borrowing under the Subscription Agreement is based on the three-month Euro Interbank Offered Rate (“EURIBOR”) plus i 3.75%. The Company is a party to an interest rate cap agreement, which has a notional amount of € i 40,000 and terminates in March 2026. The interest rate cap is intended to limit the exposure to increasing interest rates on the variable rate borrowing under our Subscription Agreement in the event that the three-month EURIBOR exceeds i 0.25%. The interest rate cap is a derivative financial instrument and was not designated as an effective hedge under ASC Topic 815, Derivatives and Hedging. Accordingly, changes in the fair value of the interest rate cap were recognized in Other income (expense), net in the condensed consolidated statement of operations, which were gains of $ i 593 and $ i 1,074 for the three and six months ended June 30, 2022, respectively, and a derivative asset of $ i 2,194 was recorded at fair value in Other long-term assets in the condensed consolidated balance sheet as of June 30, 2022.

The fair value of the interest rate cap was determined using the market standard methodology of discounting the future expected cash receipts that would occur if variable interest rates rise above the strike rate of the cap and incorporated credit valuation adjustments to appropriately reflect the risk of non-performance. The variable interest rates used in the calculation of projected receipts on the cap were based on an expectation of future interest rates derived from observable market interest rate curves and volatilities. The primary inputs to the valuation technique used to measure fair value were ranked, according to their market price observability under the fair value hierarchy, as Level 2 inputs.

Debt Discount and Financing Costs

In connection with the borrowings made under the ArcCo Subscription Agreement in January 2022, deferred financing fees were incurred totaling $ i 5,372, and a discount of $ i 1,287 was recorded. In connection with the borrowings made under the DWIP Subscription Agreement in April 2022, deferred financing fees were incurred totaling $ i 7,198. Amortization of debt discount and deferred financing costs, included in interest expense, net in the condensed consolidated statements of operations, was $ i 1,609 and $ i 379 for the three months ended June 30, 2022 and 2021, respectively, and $ i 2,715 and $ i 579 for the six months ended June 30, 2022 and 2021, respectively.

8.	Income Taxes

Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. The Company reduces the carrying amounts of deferred tax assets by a valuation allowance if, based on the available evidence, it is more likely than not that such assets will not be realized.

Income tax expense (benefit) was a benefit of $( i 577) and $( i 3,743) for the three and six months ended June 30, 2022, respectively, and an expense of $ i 6,144 and $ i 5,422 for the three and six months ended June 30, 2021, respectively. For the six months ended June 30, 2022, the effective tax rate was ( i 24.7)%, compared to ( i 13.5)% for the six months ended June 30, 2021. For the six months ended June 30, 2022, the Company’s recorded income tax expense (benefit) in relation to its pre-tax income (loss) was higher than an amount that would result from applying the applicable statutory tax rates to such income (loss), primarily due to effectively settling a tax position with a taxing jurisdiction that resulted in a $ i 1,202 reduction in the Company’s liability for unrecognized income tax benefits and a corresponding benefit in income tax expense (benefit).

9.	Stockholders’ Equity

Common Stock

Each holder of Class A Common Stock is entitled to i one vote per share on all matters and is entitled to ratably receive dividends and other distributions in cash, stock or property of the Company when, as and if declared thereon by the Company’s Board of Directors (the “Board”) from time to time out of assets or funds of the Company legally available. Each holder of the Company’s Class B Common Stock is entitled to i one vote per share together as a single class with Class A Common Stock. Shares of Class B Common Stock are deemed to be non-economic interests.

Series A Founder Preferred Stock

As of June 30, 2022, all shares of the Company’s Series A Founder Preferred Stock were held by certain of its founders. Each holder of Series A Founder Preferred Stock is entitled to a number of votes equal to the number of shares of Class A Common Stock into which each share of Series A Founder Preferred Stock could then be converted, on all matters on which stockholders are generally entitled to vote.

Stock Dividend on Series A Founder Preferred Stock

In i i February 2021 / , the Board declared and paid a stock dividend payment of i 2,474,421 shares of Class A Common Stock to the holders of all the issued and outstanding shares of Series A Founder Preferred Stock. Pursuant to the terms of the Series A Founder Preferred Stock, the holders became entitled to receive an annual dividend upon the Board’s declaration of such dividend and after the volume weighted average price of the Company’s Class A Common Stock was at or above $ i 11.50 for ten consecutive trading days in 2020. The annual dividend amount for 2020, which totaled $ i 31,391, was computed based on i 20% of the increase in the market value of one share of Class A Common Stock, being the difference between the average of the volume weighted-average Class A Common Stock prices of the last ten trading days of 2020 of approximately $ i 12.69 and $ i 10.00 per share, multiplied by i 58,425,000, which was the number of shares of Class A Common Stock outstanding as of February 10, 2020.

The computed annual dividend amount for 2021 (the “2021 Annual Dividend Amount”) was $ i 40,832 based on i 20% of the difference between the volume weighted average price of the Class A Common Stock over the last ten consecutive trading days in 2021 of approximately $ i 16.18 and $ i 12.69 per share, which was the highest average price per share previously used in calculating an annual dividend amount. With respect to the 2021 Annual Dividend Amount, on i May 6, 2022, the Board declared a stock dividend payment of i 2,523,472 shares of Class A Common Stock that was paid on i May 13, 2022.

Concurrently with the dividend payment of Class A Common Stock, rollover distributions of APW OpCo Class B Common Units, which are held in tandem with the shares of Class B Common Stock, was made to the holders of the Series A Rollover Profits Units of APW OpCo, pursuant to the Second Amended and Restated Limited Liability Company Agreement of APW OpCo, dated as of July 31, 2020, by and between its members and the Company (the “APW OpCo LLC Agreement”). Accordingly, the Company issued in the aggregate i 138,005 shares of the Company’s Class B Common Stock to the holders of the Series A Rollover Profits Units of APW OpCo concurrent with the stock dividend payment.

Series B Founder Preferred Stock

As of June 30, 2022, all shares of the Company’s Series B Founder Preferred Stock were held by certain executive officers and such shares were issued in tandem with LTIP Units (as defined in Note 10). Each holder of Series B Founder Preferred Stock is entitled to a number of votes equal to the number of shares of the Company’s Class A Common Stock and Class B Common Stock, respectively, into which each share of Series B Founder Preferred Stock could then be converted, on all matters on which stockholders are generally entitled to vote.

Noncontrolling Interest

As of June 30, 2022, noncontrolling interests consisted of limited liability company units of APW OpCo not owned by Radius. As of June 30, 2022, the portion of APW OpCo not owned by Radius was approximately i 5.6%, representing the noncontrolling interest.

10.	Share-Based Compensation

In May 2022, the Company’s stockholders approved, the Company adopted an amendment to and the Company restated its equity incentive plan, renaming the plan the 2022 Equity Incentive Plan (the “Equity Plan”), pursuant to which the maximum number of shares of Company stock (either Class A Common Stock, Class B Common Stock, or Series B Founder Preferred Stock) that may be issued or paid with respect to all awards thereunder was increased by i 11,500,000. Under the Equity Plan, the Compensation Committee of the Board is authorized to grant awards of stock options, stock appreciation rights, restricted stock, stock units, other equity-based awards and cash incentive awards that may be subject to a combination of time and performance-based vesting conditions. In accordance with ASC Topic 718, Compensation – Stock Compensation, the Company recognizes share-based compensation expense over the requisite service period of the awards (usually the vesting period) based on the grant date fair value of awards. For share-based compensation awards with performance-based milestones, the expense is recorded over the service period after the achievement of the milestone is probable or the performance condition is achieved.

Subject to adjustment, the maximum number of shares of Company stock that may be issued or paid under or with respect to all awards granted under the Equity Plan is i 25,000,000, in the aggregate. Generally, awards will deliver shares of Class A Common Stock, Class B Common Stock or Series B Founder Preferred Stock. As of June 30, 2022, there were approximately i 12,082,832 share-based awards collectively available for grant under the Equity Plan.

Long-Term Incentive Plan Units (LTIP Units)

In February 2020, the executive officers of the Company received initial awards (each, an “Initial Award”) of Series A LTIP Units and Series B LTIP Units (together with the Series C LTIP Units, the “LTIP Units”) and, in tandem with such LTIP Units, an equal number of shares of Class B Common Stock and/or shares of Series B Founder Preferred Stock, respectively. In February 2022, the Company granted the executive officers awards of additional LTIP Units (each, a “2022 LTIP Award”), consisting of Series C LTIP Units and, in tandem with such LTIP Units, an equal number of shares of Class B Common Stock.

The Initial Awards consisted of (i) i 3,376,076 time-vesting Series A LTIP Units that either vest over a three-year or five-year service period following the grant date, (ii) i 2,023,924 performance-based Series A LTIP Units that are subject to both time and performance vesting conditions, the latter condition based on the attainment of certain common share price hurdles over i seven years, and (iii) i 1,386,033 Series B LTIP Units that contain only a performance-based vesting condition based on the attainment of certain common share price hurdles over i nine years. The 2022 LTIP Awards consisted of (i) i 276,481 time-vesting Series C LTIP Units that vest over a three-year service period following the grant date, and (ii) i 829,439 performance-based Series C LTIP Units that are subject to both time and two equally weighted performance vesting conditions, the latter conditions based on the attainment of the following conditions over the three-year period ending December 31, 2024. These conditions are a) certain Company common share price returns relative to equity returns of certain peer publicly traded companies and a specified equity index (the “Market Condition”); and b) certain growth targets in the Company’s annualized in-place rents metric (the “AIPR Growth Condition”). Vesting of the performance-based Series C LTIP Units also is contingent on the recipient’s completion of service over a three-year period beginning on the grant date.

A summary of the changes in the LTIP Units for the three months ended June 30, 2022 is presented below:

Series A LTIP Units

Series B LTIP Units

Series C LTIP Units

Outstanding at December 31, 2021

i 5,340,000

i 1,386,033

—

Granted

—

i 1,105,920

Exercised

—

Outstanding at June 30, 2022

i 5,340,000

i 1,386,033

i 1,105,920

Vested at June 30, 2022

i 1,651,007

i 856,693

—

As of June 30, 2022, all awards of Series C LTIP Units are expected to vest. The fair value of each time-vesting Series C LTIP Unit and each Series C LTIP Unit vesting on the attainment of the AIPR Growth Condition was based on the grant date per share fair value of the Company’s Class A Common Stock, which was $ i 13.01 per share. For each Market Condition Series C LTIP Unit, fair value was measured as of its grant date using a Monte Carlo method which took into consideration different stock price paths. i The weighted-average grant date fair values for each Market Condition Series C LTIP Unit and the assumptions used in the determinations thereof were as follows:

	Market Condition Series C LTIP Units
Weighted-average grant date fair value	$	i 7.72
Expected term	i 3.0 years
Expected volatility		i 34.6	%
Risk-free interest rate		i 1.8	%

For the three months ended June 30, 2022 and 2021, the Company recognized share-based compensation expense of $ i 4,332 and $ i 3,313, respectively, and $ i 8,017 and $ i 6,626 for the six months ended June 30, 2022 and 2021, respectively, in the aggregate for all grants of LTIP Units. As of June 30, 2022, there was $ i 33,011 of total unrecognized compensation cost related to the LTIP Units granted, which is expected to be recognized over a weighted-average period of i 2.5 years.

Restricted Stock

i Restricted stock awards granted under the Equity Plan generally are non-transferable until vesting of each award is complete. Each restricted stock award granted under the Equity Plan grants the recipient one share of Class A Common Stock at no cost to the recipient, subject to the terms and conditions of the Equity Plan and associated award agreement. Except for performance-vesting restricted stock awards granted in February 2022 (“Performance RSAs”), vesting of restricted stock awards granted under the Equity Plan is contingent upon the recipient’s completion of service, which ranges from one to five years beginning on the grant date.

The Performance RSAs consisted of (i) i 133,308 shares of Class A Common Stock that are subject to both time and two equally weighted performance vesting conditions, the latter conditions based on the attainment of the Market Condition and AIPR Growth Condition over the three-year period ending December 31, 2024 and (ii) i 100,000 shares of Class A Common Stock that are subject to both time and performance vesting conditions, the latter condition based solely on the attainment of growth in certain annualized in-place rents of the Company over the five-year period ending December 31, 2026. Vesting of the Performance RSAs also is contingent on the recipient’s completion of service over a period of three or i five years beginning on the grant date.

A summary of the changes in the Company’s nonvested restricted stock awards for the six months ended June 30, 2022 is presented below:

	Shares			Weighted- Average Grant- Date Fair Value
Nonvested at December 31, 2021		i 95,292		$	i 10.93
Granted		i 560,594		$	i 12.51
Vested		( i 62,692	)	$	( i 12.54	)
Forfeited		—			—
Nonvested at June 30, 2022		i 593,194		$	i 12.25

As of June 30, 2022, all Performance RSAs are expected to vest. The fair value of each Performance RSA vesting on the attainment of annualized in-place rent criteria was based on the grant date per share fair value of the Company’s Class A Common Stock, which was $ i 13.01 per share. For each Market Condition Performance RSA, fair value was measured as of its grant date using a Monte Carlo method which took into consideration different stock price paths. i The weighted-average grant date fair values for each Market Condition Performance RSA and the assumptions used in the determinations thereof were as follows:

	Market Condition Restricted Stock Awards
Weighted-average grant date fair value	$	i 7.72
Expected term	i 3.0 years
Expected volatility		i 34.6	%
Risk-free interest rate		i 1.8	%

For the three months ended June 30, 2022 and 2021, the Company recognized share-based compensation expense for restricted stock awards of $ i 598 and $ i 196, respectively, and $ i 965 and $ i 692 for the six months ended June 30, 2022 and 2021, respectively. As of June 30, 2022, there was $ i 6,404 of total unrecognized compensation cost related to restricted stock awards granted as of June 30, 2022. The total cost is expected to be recognized over a weighted-average period of i 3.8 years.

Stock Options

The following table summarizes the changes in the number of common shares underlying options for the six months ended June 30, 2022:

	Shares			Weighted- Average Exercise Price
Outstanding at December 31, 2021		i 3,989,100		$	i 10.32
Granted		i 330,000		$	i 13.32
Exercised		( i 33,285	)	$	i 7.82
Forfeited		( i 64,900	)	$	i 12.23
Outstanding at June 30, 2022		i 4,220,915		$	i 10.54
Exercisable at June 30, 2022		i 1,232,015		$	i 8.81

Expiring on the tenth anniversary following the grant date, each employee option award vests upon the completion of i five years of service. i For stock options granted during the six months ended June 30, 2022, the weighted-average grant date fair values for employee stock options and the weighted-average assumptions used in the determinations thereof were as follows:

	Six months ended June 30, 2022
Weighted-average grant date fair value	$	i 4.14
Expected term	i 6.5 years
Expected volatility		i 26.4	%
Risk-free interest rate		i 1.9	%

For the three months ended June 30, 2022 and 2021, the Company recognized share-based compensation expense of $ i 566 and $ i 333, respectively, and $ i 1,106 and $ i 626 for the six months ended June 30, 2022 and 2021, respectively, for stock options granted to employees. As of June 30, 2022, there was $ i 8,017 of total unrecognized compensation cost, which is expected to be recognized over a weighted-average period of i 3.8 years.

11.	Basic and Diluted Income (Loss) per Common Share

Diluted earnings (loss) per common share is calculated by dividing the net income allocable to common stockholders of Radius by the weighted average number of common shares outstanding, adjusted for the effects of potentially dilutive common stock. For all periods presented with a net loss, the effects of any incremental potential common shares have been excluded from the calculation of loss per common share because their effect would be anti-dilutive. Therefore, the weighted-average shares outstanding used to calculate both basic and diluted loss per common share were the same for periods with a net loss attributable to common stockholders of Radius. i The following table sets forth the computation of basic and diluted net loss per common share:

Three months

ended

Six months

ended

Three months

ended

Six months

ended

Numerator:

Net income (loss) attributable to stockholders

i i 22,167 /

i i 17,730 /

( i i 34,522 /

)

( i i 42,101 /

)

Stock dividend payment to holders of Series A Founder Preferred Stock

( i i 40,832 /

)

( i i 40,832 /

)

—

( i i 31,391 /

)

Net loss attributable to common stockholders

( i i 18,665 /

)

( i i 23,102 /

)

( i i 34,522 /

)

( i i 73,492 /

)

Denominator:

Weighted average common shares outstanding - basic and diluted

i i 93,506,412 /

i i 92,809,563 /

i i 68,724,275 /

i i 64,127,528 /

Basic and diluted loss per common share

( i i 0.20 /

)

( i i 0.25 /

)

( i i 0.50 /

)

( i i 1.15 /

)

The following potentially dilutive securities have been excluded from the computation of diluted weighted-average shares outstanding as they would be anti-dilutive:

Three months

ended

Six months

ended

Three months

ended

Six months

ended