SHAREHOLDERS’ EQUITY | SHAREHOLDERS’ EQUITY Initial Public Offering On closing of the IPO, owners of the Contributed Bridge GPs contributed their interests in the respective Contributed Bridge GPs in exchange for LLC Interests in the Operating Company. Prior to the IPO, the Operating Company did not have any direct interest in the Contributed Bridge GPs. Subsequent to the Transactions, the Operating Company consolidates the Contributed Bridge GPs. These condensed consolidated financial statements include 100% of the results of operations and performance of the Contributed Bridge GPs for the periods presented, including prior to the IPO, on the basis of common control prior to the Transactions. The net income that is not attributable to the Operating Company is reflected in net income attributable to non-controlling interests in the subsidiaries in the condensed consolidated statements of operations and comprehensive income. Prior to the Transactions, the Contributed Bridge GPs had three classes of shares: (i) Class A; (ii) Class C; and (iii) Class D. Class A represented the voting interest and Classes C and D represented allocations of carried interest to employees of the Operating Company, which are included in performance allocations compensation. As part of the Transactions, all of the Class C shares of the Contributed Bridge GPs were exchanged for interests in the Operating Company. Generally, if at the termination of a fund (and at interim points in the life of a fund), the fund has not achieved investment returns that exceed the preferred return threshold or (in all cases) the applicable Bridge GP receives net profits over the life of the fund in excess of its allocable share under the applicable partnership agreement, the Bridge GP will be obligated to repay an amount equal to the excess of amounts previously distributed to the Bridge GP over the amounts to which the Bridge GP was ultimately entitled (generally net of income tax liabilities associated with related allocations of taxable income). All of the distributable earnings of the Operating Company prior to the IPO were payable to the Original Equity Owners. As of September 30, 2023 and December 31, 2022, there was $0.5 million that was declared that had not yet been distributed to Original Equity Owners. Changes in Shareholders’ Equity and Non-Controlling Interests Collapse of 2021 Profits Interests Awards On July 1, 2023, certain of the Company’s 2021 profits interests awards were collapsed into 489,407 shares of Class A common stock and 2,429,453 Class A Units. The profits interests were collapsed based on their fair values and the relative value of the Company, based on Distributable Earnings attributable to the Operating Company, Distributable Earnings of the applicable subsidiary where such profits interests were held, and the market price of the Company’s Class A common stock as of the date of the collapse. This resulted in a decrease in net income attributable to non-controlling interests for periods subsequent to July 1, 2023; however, there was a corresponding increase in the number of outstanding Class A Units and shares of Class A common stock. The collapse of the 2021 profits interests awards was accounted for as a modification and therefore there was no change in the unamortized share-based compensation expense for the three and nine months ended September 30, 2023. Collapse of 2020 Profits Interests Awards On January 1, 2023, certain of the Company’s 2020 profits interests awards were collapsed into 801,927 shares of our Class A common stock and 2,025,953 Class A Units. The profits interests were collapsed based on their fair values and the relative value of the Company, based on distributable earnings attributable to the Operating Company, distributable earnings of the applicable subsidiary where such profits interests were held, and the market price of our Class A common stock as of the date of the collapse. This resulted in a decrease in net income attributable to non-controlling interests for periods subsequent to January 1, 2023; however, there was a corresponding increase in the number of outstanding Class A Units and shares of our Class A common stock. The collapse of the 2020 profits interests awards was partially accounted for as a modification and partially accounted for as cancellations. For the 2020 profits interests awards that were cancelled, the Company accelerated the recognition of the unamortized share-based compensation expense amounting to $0.3 million for the nine months ended September 30, 2023. Collapse of 2019 Profits Interests Awards On January 1, 2022, certain of the Company’s 2019 profits interests awards were collapsed into 790,424 shares of our Class A common stock and 13,255,888 Class A Units. The profits interests were collapsed based on their fair values and the relative value of the Company, based on distributable earnings attributable to the Operating Company, distributable earnings of the applicable subsidiary where such profits interests were held, and the market price of our Class A common stock as of the date of the collapse. This resulted in a decrease in net income attributable to non-controlling interests for periods subsequent to January 1, 2022; however, there was a corresponding increase in the number of outstanding Class A Units and shares of our Class A common stock. The collapse of the 2019 profits interests awards was partially accounted for as a modification and partially accounted for as cancellations. For the 2019 profits interests awards that were cancelled, the Company accelerated the recognition of the unamortized share-based compensation expense amounting to $0.6 million for the nine months ended September 30, 2022. Issuance of Class A Units for GBC Acquisition In January 2022, the Company acquired a 60% interest in GBC’s asset and property management business for consideration of $30 million, with 50% paid in cash and 50% paid through the issuance of 694,412 Class A Units of the Operating Company valued at $14.9 million, which was based on an average of the closing stock price of our Class A common stock prior to the closing of the GBC Acquisition. Redemptions of Non-controlling Interest in Bridge Investment Group Holdings Inc. Certain current and former employees of the Company directly or indirectly own interests in the Operating Company, presented as non-controlling interests in the Operating Company. Non-controlling interests in the Operating Company have the right to require the Operating Company to redeem part or all of such member’s Class A Units for cash based on the market value of an equivalent number of shares of our Class A common stock at the time of redemption, or at the Company’s election as managing member of the Operating Company, through issuance of shares of our Class A common stock on a one-for-one basis. At the end of each period, non-controlling interests in the Operating Company is adjusted to reflect their ownership percentage in the Operating Company at the end of the period, through a reallocation between controlling and non-controlling interests in the Operating Company. During the nine months ended September 30, 2023, 1,303,754 Class A Units were redeemed, with the issuance of our Class A common stock on a one-for-one basis. Bridge Investment Group Holdings Inc. The Company has two classes of common stock outstanding, Class A common stock and Class B common stock. Our Class A common stock is traded on the New York Stock Exchange. As of September 30, 2023, the Company is authorized to issue 500,000,000 shares of Class A common stock with a par value of $0.01 per share, 237,680,340 shares of Class B common stock with a par value of $0.01 per share, and 20,000,000 shares of preferred stock, with a par value of $0.01 per share. Each share of our Class A common stock is entitled to one vote and each share of our Class B common stock is entitled to ten votes. Refer to Note 1, “Organization” for additional information about the Company’s common stock. As of September 30, 2023, 34,369,805 shares of our Class A common stock (including Restricted Stock) were outstanding, 84,117,321 shares of our Class B common stock were outstanding, and no shares of preferred stock were outstanding. The following table presents a reconciliation of Bridge Investment Group Holdings Inc. common stock for the nine months ended September 30, 2023: Bridge Investment Group Holdings Inc. Class A Class A Class B Balance as of December 31, 2022 24,484,585 5,003,936 85,301,127 Class A common stock issued - 2020 and 2021 profits interests conversion 73,894 1,217,440 — Class A common stock issued - unitholder conversions 1,303,754 — (1,138,754) Class A restricted common stock issued — 2,424,142 — Class A restricted common stock forfeited — (137,946) — Class B common stock redeemed — — (45,052) Class A restricted common stock vested 598,495 (598,495) — Balance as of September 30, 2023 26,460,728 7,909,077 84,117,321 Dividends are made to our Class A common stockholders and distributions are made to members of the Operating Company and holders of non-controlling interests in subsidiaries. Distributions are reflected when paid in the condensed consolidated statements of stockholders’ equity, while dividends on our Class A common stock are reflected when declared by the Company’s board of directors. During the three and nine months ended September 30, 2023 and 2022, the Company declared and paid the following dividends on our Class A common stock (dollars in thousands, except per share amounts): Dividend Record Date Dividend Payment Date Dividend per Share of Common Stock Dividend to Common Stockholders March 10, 2023 March 24, 2023 $ 0.17 $ 5,541 June 2, 2023 June 16, 2023 0.15 4,850 September 1, 2023 September 15, 2023 0.17 5,805 $ 0.49 $ 16,196 March 11, 2022 March 25, 2022 $ 0.21 $ 5,917 June 3, 2022 June 17, 2022 0.26 7,614 September 2, 2022 September 16, 2022 0.30 8,861 $ 0.77 $ 22,392 Bridge Investment Group Holdings LLC Prior to the IPO, the Operating Company had three classes of membership interests: (i) Class A; (ii) Class B-1; and (iii) Class B-2. Class A and Class B-1 represented the voting equity holders and Class B-2 represented profits interests awarded to employees of the Operating Company. Class B-1 and B-2 interests were issued as “profits interests,” pursuant to agreements entered into with certain employees during 2021, 2020 and 2019. At the time of issuance, the Class B-1 and B-2 interests had a capital account interest of zero. The holders of Class B-1 and B-2 interests were entitled to distributions in excess of the defined threshold per the respective award. The holders of Class B-2 interests did not have voting rights. As part of the Transactions, the Class B-1 and Class B-2 interests were exchanged for Class A Units in the Operating Company. As part of the Transactions, 97,463,981 new Class B Units were issued. Net profits and any other items of income are allocated to the members’ capital accounts in a manner that is consistent with their respective ownership percentages. Distributions to members are generally made in a manner consistent with their respective ownership percentages at the time the profits were generated and are subject to approval of the Company’s board of directors. During the three and nine months ended September 30, 2023, $14.0 million and $33.4 million, respectively, was distributed to non-controlling interests in the Operating Company and $24.0 million and $73.4 million, respectively, was distributed to non-controlling interest in the Company. During the three and nine months ended September 30, 2022, $13.1 million and $69.1 million, respectively, was distributed to the Operating Company’s members and $37.8 million and $108.6 million, respectively, was distributed to non-controlling interests in the Operating Company. The Operating Company’s members’ capital interests are transferable; however, transfers are subject to obtaining the prior written consent of the Company, with certain exceptions for transfers to affiliated parties. Members’ liability is limited to the capital account balance. Distributions are reflected in the condensed consolidated statements of changes in equity when declared by the board of directors and consist of distributions to members and non-controlling interest holders. As of September 30, 2023, the Company is the sole managing member of the Operating Company, and owns 34,369,805 Class A Units and 97,463,981 Class B Units (voting only) of the Operating Company, which represents 25% and 100% of the total outstanding Class A Units and Class B Units, respectively. The Company controls the business and affairs of the Operating Company and its direct and indirect subsidiaries. The following table presents a reconciliation of the Operating Company’s Class A Units and Class B Units for the nine months ended September 30, 2023: Bridge Investment Group Holdings LLC Class A Class B Balance as of December 31, 2022 124,445,671 97,463,981 Issuance of Class A Units 5,763,498 — Forfeiture of unvested Class A Units (48,191) — Balance as of September 30, 2023 130,160,978 97,463,981 |