Large accelerated
filer
o
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Accelerated filer o | Non-accelerated filer þ | Smaller reporting company o | |||
(Do not check if a smaller reporting company) |
The
information in this prospectus is not complete and may be
changed. We may not sell these securities until the registration
statement filed with the Securities and Exchange Commission is
effective. The prospectus is not an offer to sell the securities
and it is not soliciting an offer to buy these securities in any
state where the offer or sale is not permitted.
|
| We have no prior operating history and there is no assurance that we will be able to successfully achieve our investment objectives. | |
| We set the offering price of our shares of common stock arbitrarily. This price is unrelated to the book value or net asset value of our shares of common stock or to our expected operating income. | |
| Because there is no public trading market for shares of our common stock and we are not obligated to effectuate a liquidity event by a certain date, it will be difficult for you to sell your shares of our common stock. | |
| This is a blind pool offering and you will not have the opportunity to evaluate our investments prior to purchasing shares of our common stock. | |
| We depend upon our advisor and its affiliates to conduct our operations and this offering. Adverse changes in the financial health of our advisor or its affiliates could cause our operations to suffer. | |
| This is the first public offering sold by our dealer manager. Our ability to raise money and achieve our investment objectives depends on the ability of our dealer manager to successfully market our offering. | |
| Our advisor and other affiliates will face conflicts of interest as a result of compensation arrangements, time constraints and competition for investments, which could result in actions that are not in your best interests. | |
| We may incur debt exceeding 75% of the cost of our assets in certain circumstances. High debt levels increase the risk to our stockholders. | |
| The amount of any distributions we may make is uncertain. Our distributions may exceed our earnings, particularly during the period before we have substantially invested the net proceeds from this offering. Therefore, we may need to borrow funds, request that our advisor, in its discretion, defer its receipt of fees and reimbursement of expenses, or utilize offering proceeds to make cash distributions. As a result, portions of the distributions that we make may represent a return of capital to you. |
| The recent economic downturn and disruption in the financial markets could have an adverse impact on our tenants ability to make rental payments and the demand for retail space, result in continued disruptions in the commercial mortgage market and adversely effect our ability to obtain financing on favorable terms, if at all. |
| If we fail to qualify as a REIT, it would adversely affect our operations and our ability to make distributions to our stockholders and may have adverse tax consequences to our stockholders. |
Sales
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Dealer
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Proceeds to Us
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||||||||||||||
Price to Public(1) | Commission(1)(2) | Manager Fee(1)(2) | Before Expenses(1)(3) | |||||||||||||
Primary Offering Per Share
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$ | 10.00 | $ | 0.70 | $ | 0.30 | $ | 9.00 | ||||||||
Total Minimum
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$ | 2,000,000.00 | $ | 140,000.00 | $ | 60,000.00 | $ | 1,800,000.00 | ||||||||
Total Maximum
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$ | 1,000,000,000.00 | $ | 70,000,000.00 | $ | 30,000,000.00 | $ | 900,000,000.00 | ||||||||
Distribution Reinvestment Plan Offering Per Share
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$ | 9.50 | | $ | | $ | 9.50 | |||||||||
Total Maximum
|
$ | 100,000,000.00 | | $ | | $ | 100,000,000.00 |
(1) | We reserve the right to reallocate shares of common stock being offered between the primary offering and our distribution reinvestment plan. | |
(2) | Discounts are available for certain categories of purchasers. | |
(3) | Proceeds are calculated before reimbursing our advisor for organization and offering expenses. |
| a net worth (excluding the value of an investors home, furnishings and automobiles) of at least $250,000; or | |
| a gross annual income of at least $70,000 and a net worth (excluding the value of an investors home, furnishings and automobiles) of at least $70,000. |
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| Read this entire prospectus and any appendices and supplements accompanying this prospectus. |
| Complete the execution copy of the subscription agreement. A specimen copy of the subscription agreement, including instructions for completing it, is included in this prospectus as Appendix C. |
| Deliver a check for the full purchase price of the shares of our common stock being subscribed for along with the completed subscription agreement to the soliciting broker-dealer or investment advisor. Initially, your check should be made payable to CommerceWest Bank, N.A., as escrow agent for TNP Strategic Retail Trust, Inc. After we meet the minimum offering requirements, your check should be made payable to TNP Strategic Retail Trust, Inc. After you have satisfied the applicable minimum purchase requirement, additional purchases must be in increments of $100, except for purchases made pursuant to our distribution reinvestment plan. |
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F-1
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C-1
D-1
EX-1.1 DEALER MANAGER AGREEMENT
EX-3.1 ARTICLES OF AMENDMENT AND RESTATEMENT
EX-5.1 OPINION OF VENABLE LLP
EX-8.1 OPINION OF ALSTON & BIRD LLP
EX-10.1 ESCROW AGREEMENT
EX-10.2 ADVISORY AGREEMENT
EX-10.4 2009 LONG-TERM INCENTIVE PLAN
EX-10.5 INDEPENDENT DIRECTORS COMPENSATION PLAN
EX-23.1 CONSENT OF DELOITTE & TOUCHE LLP
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Q:
What is a REIT?
A:
In general, a REIT is a company that:
Q:
How will you structure the ownership and operation of your
assets?
A:
We plan to own substantially all of our assets and conduct our
operations through an operating partnership, TNP Strategic
Retail Operating Partnership, LP, which was organized in
Delaware in September 2008. We are the sole general partner of
TNP Strategic Retail Operating Partnership, LP, which we refer
to as our operating partnership. Because we will
conduct substantially all of our operations through an operating
partnership, we are organized in what is referred to as an
UPREIT structure.
Q:
What is an UPREIT?
A:
UPREIT stands for Umbrella Partnership Real Estate Investment
Trust. We use the UPREIT structure because a contribution of
property directly to us is generally a taxable transaction to
the contributing property owner. In this structure, a
contributor of a property who desires to defer taxable gain on
the transfer of his or her property may transfer the property to
the operating partnership in exchange for limited partnership
units and defer taxation of gain until the contributor later
exchanges his or her limited partnership units, typically on a
one-for-one basis for shares of the common stock of the REIT. We
believe that using an UPREIT structure gives us an advantage in
acquiring desired properties from persons who may not otherwise
sell their properties because of unfavorable tax results.
Q:
Do you currently own any assets?
A:
No. This offering is a blind pool offering in
that we have not yet identified any specific real estate assets
to acquire using the proceeds from this offering. We discuss the
risks associated with this status under Risk
FactorsInvestment RisksThis is a blind
pool offering, and you will not have the opportunity to
evaluate our investments prior to purchasing shares of our
common stock. and Risk FactorsRisks Related to
Our BusinessIf we are delayed or unable to find suitable
investments, we may not be able to achieve our investment
objectives.
Q:
Who will choose which investments to make?
A:
Our advisor, TNP Strategic Retail Advisor, LLC, will select
investments for us based on specific investment objectives and
criteria and subject to the direction, oversight and approval of
our board of directors.
Q:
What kind of offering is this?
A:
Through our dealer manager, we are offering a minimum of
$2,000,000 in shares of our common stock and a maximum of
$1,000,000,000 in shares of our common stock in our primary
offering on a best efforts basis at $10.00 per
share. We are also offering $100,000,000 in shares of our common
stock pursuant to our distribution reinvestment plan at $9.50
per share to those stockholders who elect to participate in such
plan as described in this prospectus. We reserve the right to
reallocate the shares of common stock we are offering between
the primary offering and the distribution reinvestment plan.
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Q:
How does a best efforts offering work?
A:
When shares of common stock are offered to the public on a
best efforts basis, the broker-dealers participating
in the offering are only required to use their best efforts to
sell the shares of our common stock. Broker-dealers do not have
a firm commitment or obligation to purchase any of the shares of
our common stock.
Q:
How long will this offering last?
A:
This offering will not last
beyond ,
2011 (two years from the date of this prospectus), unless
extended. However, in certain states this offering may only
continue for one year unless we renew the offering period for up
to one additional year.
Q:
What happens if you do not raise a minimum of $2,000,000 in
this offering?
A:
We will not sell any shares of our common stock unless we sell a
minimum of $2,000,000 in shares to the public
by ,
2010 (one year from the date of this prospectus). Purchases by
our directors, officers and affiliates will not count toward
meeting this minimum threshold. Pending satisfaction of this
minimum offering requirement, all subscription payments will be
placed in an account held by CommerceWest Bank, N.A., as escrow
agent, in trust for subscribers benefit pending release to
us. If we do not sell $2,000,000 in shares to the public
by ,
2010 (one year from the date of this prospectus), we will
terminate this offering and return all subscribers funds
held in escrow, plus interest. If we raise the minimum offering
amount
by ,
2010, the proceeds held in escrow, plus interest, will be
released to us. The released escrow proceeds will only be used
for the purposes set forth in this prospectus and in a manner
approved by our board of directors, who act as fiduciaries to
our stockholders.
Q:
Will I receive a stock certificate?
A:
No. You will not receive a stock certificate unless
expressly authorized by our board of directors. We anticipate
that all shares of our common stock will be issued in book-entry
form only. The use of book-entry registration protects against
loss, theft or destruction of stock certificates and reduces the
offering costs.
Q:
Who can buy shares of common stock in this offering?
A:
In general, you may buy shares of our common stock pursuant to
this prospectus provided that you have either (1) a net
worth of at least $70,000 and an annual gross income of at least
$70,000 or (2) a net worth of at least $250,000. For this
purpose, net worth does not include your home, home furnishings
and personal automobiles. Generally, you must initially invest
at least $1,000. After you have satisfied the applicable minimum
purchase requirement, additional purchases must be in increments
of $100, except for purchases made pursuant to our distribution
reinvestment plan, which are not subject to any minimum purchase
requirement. These minimum net worth and investment levels may
be higher in certain states, so you should carefully read the
more detailed description under Suitability
Standards above.
Our affiliates may also purchase shares of our common stock. The
sales commissions and dealer manager fees that are payable by
other investors in this offering will be reduced or waived for
our affiliates. The purchase of shares of our common stock by
our affiliates will not count toward satisfying our minimum
offering requirements.
Q:
Are there any special restrictions on the ownership of
shares?
A:
Yes. Our charter prohibits the ownership of more than 9.8% in
value of our capital stock (which includes common stock and
preferred stock we may issue) and more than 9.8% in value or
number of shares, whichever is more restrictive, of our common
stock, unless exempted by our board of directors. This
prohibition may discourage large investors from purchasing our
shares and may limit your ability to transfer your shares. To
comply with tax rules applicable to REITs, we will require our
record holders to provide us with detailed information regarding
the beneficial ownership of our shares on an annual basis. These
restrictions are designed to enable us to comply with the
ownership restrictions imposed on REITs
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by the Internal Revenue Code. See Description of Capital
StockRestriction on Ownership of Shares of Capital
Stock.
Q:
Is there any minimum initial investment required?
A:
Yes. To purchase shares of common stock in this offering, you
must generally make an initial purchase of at least $1,000 in
shares. Once you have satisfied the minimum initial purchase
requirement, any additional purchases of our shares of common
stock in this offering must be in amounts of at least $100,
except for additional purchases pursuant to our distribution
reinvestment plan which are not subject to any minimum
investment requirement. See Plan of
DistributionMinimum Offering.
Q:
How do I subscribe for shares of common stock?
A:
Investors who meet the suitability standards described herein
may purchase shares of our common stock. See Suitability
Standards. Investors seeking to purchase shares of our
common stock should proceed as follows:
By executing the subscription agreement and paying the total
purchase price for the shares of our common stock subscribed
for, each investor represents that he meets the suitability
standards as stated in the subscription agreement and agrees to
be bound by all of its terms.
Subscriptions will be effective only upon our acceptance, and we
reserve the right to reject any subscription in whole or part.
Subscriptions will be accepted or rejected within 30 days
of receipt by us and, if rejected, all funds shall be returned
to subscribers without deduction for any expenses within 10
business days from the date the subscription is rejected. We are
not permitted to accept a subscription for shares of our common
stock until at least five business days after the date you
receive the final prospectus.
An approved trustee must process and forward to us subscriptions
made through individual IRAs, Keough plans and 401(k) plans. In
the case of investments through IRAs, Keough plans and 401(k)
plans, we will send the confirmation and notice of our
acceptance to the trustee.
Q:
How will the payment of fees and expenses affect my invested
capital?
A:
We will pay sales commissions and dealer manager fees in
connection with this offering. In addition, we will reimburse
our advisor for our organization and offering expenses up to
3.0% of the gross proceeds of the offering and will pay our
advisor acquisition and origination fees for substantial
services provided in the acquisition or origination of
investments. The payment of fees and expenses will reduce the
funds available to us for investment in real estate assets and
real estate-related assets. Depending primarily upon the number
of shares of our common stock we sell in the primary offering
and assuming a $10.00 purchase price for shares sold in the
primary offering, we estimate that we will use between 84.4% and
86.7% of our gross offering proceeds for investments and 2.2% of
our gross offering proceeds for the payment of acquisition and
origination fees to our advisor. The payment of fees and
expenses will also reduce the book value of your shares of
common stock. However, you will not be required to pay any
additional amounts in connection with the fees and expenses
described in this prospectus.
Q:
If I buy shares, will I receive distributions and how
often?
A:
Provided we have sufficient available cash flow, we expect to
pay distributions on a monthly basis to our stockholders. We
cannot predict when, if ever, we will generate sufficient cash
flow to pay distributions.
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Q:
May I reinvest my distributions?
A:
Yes. Please see Description of Capital
StockDistribution Reinvestment Plan for more
information regarding our distribution reinvestment plan.
Q:
If I buy shares of common stock in this offering, how may I
later sell them?
A:
At the time you purchase the shares of our common stock, the
shares will not be listed for trading on any national securities
exchange. As a result, if you wish to sell your shares, you may
not be able to do so promptly, or at all, or you may only be
able to sell them at a substantial discount from the price you
paid. In general, however, you may sell your shares to any buyer
that meets the applicable suitability standards unless such sale
would cause the buyer to own more than 9.8% of the value of our
then outstanding capital stock (which includes common stock and
any preferred stock we may issue) or more than 9.8% of the value
or number of shares, whichever is more restrictive, of our then
outstanding common stock. See Suitability Standards
and Description of Capital StockRestriction on
Ownership of Shares of Capital Stock. We have adopted a
share redemption program, as discussed under Description
of Capital StockShare Redemption Program, which
may provide limited liquidity for some of our stockholders.
Q:
What is your exit strategy?
A:
Our board of directors does not anticipate evaluating a
transaction providing liquidity for our stockholders until 2015.
Our charter does not require our board of directors to pursue a
liquidity event. Due to the uncertainties of market conditions
in the future, we believe setting finite dates for possible, but
uncertain, liquidity events may result in actions not
necessarily in the best interests or within the expectations of
our stockholders. We expect that our board of directors, in the
exercise of its fiduciary duty to our stockholders, will
determine to pursue a liquidity event when it believes that
then-current market conditions are favorable for a liquidity
event, and that such a transaction is in the best interests of
our stockholders. A liquidity event could include (1) the
sale of all or substantially all of our assets either on a
portfolio basis or individually followed by a liquidation, in
which the net proceeds are distributed to stockholders,
(2) a merger or another transaction approved by our board
of directors in which our stockholders will receive cash and/or
shares of a publicly traded company or (3) a listing of our
shares on a national securities exchange. There can be no
assurance as to when a suitable transaction will be available.
Q:
Will the distributions I receive be taxable?
A:
Distributions that you receive, including the market value of
our common stock received pursuant to our distribution
reinvestment plan, will generally be taxed as ordinary income to
the extent they are paid out of our current or accumulated
earnings and profits. However, if we recognize a long-term
capital gain upon the sale of one of our assets, a portion of
our dividends may be designated and treated as a long-term
capital gain. In addition, we expect that some portion of your
distributions may not be subject to tax in the year received due
to the fact that depreciation expenses reduce earnings and
profits but do not reduce cash available for distribution.
Amounts distributed to you in excess of our earnings and profits
will reduce the tax basis of your shares of common stock and
will not be taxable to the extent thereof, and distributions in
excess of tax basis will be taxable as an amount realized from
the sale of your shares of common stock. This, in effect, would
defer a portion of your tax until your investment is sold or we
are liquidated, at which time you may be taxed at capital gains
rates. However, because each investors tax considerations
are different, we suggest that you consult with your tax advisor.
Q:
When will I get my detailed tax information?
A:
We intend to mail your Form 1099 tax information, if
required, by January 31 of each year.
Q:
Where can I find updated information regarding the
company?
A:
You may find updated information on our website,
www.tnpre.com
. In addition, as a result of the
effectiveness of the registration statement of which this
prospectus forms a part, we are subject to the informational
reporting requirements of the Securities Exchange Act of 1934,
as amended, or the Exchange Act. Under the Exchange Act, we will
file reports, proxy statements and other information with the
SEC. See
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Table of Contents
Additional Information for a description of how you
may read and copy the registration statement, the related
exhibits and the reports, proxy statements and other information
we file with the SEC. In addition, you will receive periodic
updates directly from us, including three quarterly financial
reports and an annual report. We do not intend to calculate the
net asset value per share for our shares of common stock until
eighteen months after the completion of the last offering of our
shares of common stock, and therefore will not provide you with
this information until that time. See Risk
FactorsInvestment RisksWe will not calculate the net
asset value per share for our shares of common stock until
eighteen months after completion of our offering stage.
Therefore, you will not be able to determine the true value of
your shares of common stock on an on-going basis during this
offering.
Q:
Who can answer my questions?
A:
If you have additional questions about this offering or if you
would like additional copies of this prospectus, you should
contact your registered representative or our dealer manager:
1900 Main Street
Suite 700
Irvine, California 92614
949-823-8222
Attn: Investor Services
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to preserve, protect and return stockholders capital
contributions;
to pay predictable and sustainable cash distributions to
stockholders; and
to realize capital appreciation upon the ultimate sale of the
investments we acquire.
We have no prior operating history and there is no assurance
that we will be able to successfully achieve our investment
objectives.
No public trading market exists for our shares and we are not
required to effectuate a liquidity event by a certain date. As a
result, it will be difficult for you to sell your shares. If you
are able to sell your shares, you will likely sell them at a
substantial discount.
The amount of distributions we will make, if any, is uncertain.
Our distributions may exceed our earnings, particularly during
the period before we have substantially invested the net
proceeds from this offering. Therefore, we may need to borrow
funds, request that our advisor, in its discretion, defer its
receipt of fees and reimbursement of expenses, or utilize
offering proceeds to make cash distributions. As a result,
portions of the distributions that we make may represent a
return of capital to you, which will lower your tax basis in our
shares.
This is a blind pool offering and you will not have
the opportunity to evaluate our investments prior to purchasing
shares of our common stock.
This is a best efforts offering and if we are unable
to raise substantial funds then we will be limited in the number
and type of investments we may make. This is the first
non-listed REIT offering sold by our dealer manager. Our ability
to raise money and achieve our investment objectives depends on
the ability of our dealer manager to successfully market our
offering.
We rely on our advisor and its affiliates for our day-to-day
operations and the selection of our investments. We will pay
substantial fees to our advisor, which were not determined on an
arms-length basis.
Our advisor and other affiliates will face conflicts of interest
as a result of compensation arrangements, time constraints and
competition for investments, including (1) conflicts
related to compensation payable by us to our advisor and other
affiliates that may not be on terms that would result from
arms-length negotiations between unaffiliated parties,
(2) the allocation of time between advising us and other
real estate investment programs and (3) the recommendation
of investments on our behalf when other affiliated programs are
seeking similar investments.
We are the first publicly-offered investment program sponsored
by our sponsor. You should not assume that the prior performance
of programs managed or sponsored by our sponsor or its
affiliates will be indicative of our future performance.
Our use of leverage increases the risk of loss on our
investments.
We will be subject to risks generally incident to the ownership
of real property.
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The recent economic downturn and disruption in the financial
markets could have an adverse impact on our tenants
ability to make rental payments and the demand for retail space,
result in continued disruptions in the commercial mortgage
market and adversely effect our ability to obtain financing on
favorable terms, if at all.
If we fail to qualify as a REIT, it would adversely affect our
operations and our ability to make distributions to our
stockholders because we will be subject to U.S. federal
income tax at regular corporate rates with no ability to deduct
distributions made to our stockholders.
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Estimated Amount
Organizational and Offering Stage
Sales Commission
Dealer Manager
7.0% of gross offering proceeds from the sale of shares in the
primary offering (all or a portion of which may be reallowed to
participating broker-dealers). No sales commissions will be paid
for sales pursuant to the distribution reinvestment plan.
$70,000,000
Dealer Manager FeeDealer Manager
3.0% of gross offering proceeds from the sale of shares in the
primary offering (a portion of which may be reallowed to
participating broker-dealers). No dealer manager fees will be
paid for sales pursuant to the distribution reinvestment plan.
$30,000,000
Organizational and Offering Expense Reimbursement
Advisor or its affiliates
Reimbursement for organizational and offering expenses incurred
on our behalf, up to 3.0% of the gross offering proceeds. We
estimate that organization and offering expenses will be 1.75%
if the maximum offering proceeds from the primary offering is
raised.
$17,500,000
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Estimated Amount
Operational Stage
Acquisition Fees
Advisor
2.5% of (1) the cost of investments we acquire or
(2) our allocable cost of investments acquired in a joint
venture, in each case including purchase price, acquisition
expenses and any debt attributable to such investments. With
respect to investments in and origination of real estate-related
loans, we will pay an origination fee to our advisor in lieu of
an acquisition fee.
$24,562,500 (assuming no leverage is used). $49,125,000
(assuming a leverage ratio of 50%).
Origination Fees
Advisor
2.5% of the amount funded by us to acquire or originate real
estate-related loans, including third party expenses related to
such investments and any debt we use to fund the acquisition or
origination of the real estate-related loans. We will not pay an
acquisition fee with respect to such real estate-related loans.
$24,562,500 (assuming no leverage is used). $49,125,000
(assuming a leverage ratio of 50%).
Asset Management FeesAdvisor
A monthly amount equal to one-twelfth of 0.6% of the sum of the
aggregate cost of all assets we own and of our investments in
joint ventures, including acquisition fees, origination fees,
acquisition and origination expenses and any debt attributable
to such investments; provided, however, that our advisor will
not be paid the asset management fee until our funds from
operations exceed the lesser of (1) the cumulative amount
of any distributions declared and payable to our stockholders or
(2) an amount that is equal to a 10.0% cumulative,
non-compounded, annual return on invested capital for our
stockholders. Separate and distinct from the asset management
fee, we will also reimburse our advisor or its affiliates for
all expenses paid or incurred on our behalf, including the
salaries and benefits of persons performing services for us
except for the salaries and benefits of persons who also serve
as one of our executive officers or as an executive officer of
our advisor.
Actual amounts depend upon the aggregate cost of our
investments, and, therefore, cannot be determined at this time.
Property Management and Leasing FeesTNP Property
Management, LLC
A monthly market-based fee for property management services of
up to 5.0% of the gross revenues generated by our properties.
Our property manager may subcontract with third party property
managers and will be responsible for supervising and
compensating those property managers.
Actual amounts depend upon the gross revenue of the properties
and customary property management and leasing fees in the region
in which properties are acquired, and, therefore, cannot be
determined at this time.
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Estimated Amount
Operating Expenses
Advisor
We will reimburse our advisor for all expenses paid or incurred
by our advisor in connection with the services provided to us,
including our allocable share of the advisors overhead,
such as rent, personnel costs, utilities and IT costs. We will
not reimburse our advisor for personnel costs in connection with
services for which our advisor is entitled to acquisition,
origination or disposition fees.
Actual amounts are dependent upon expenses paid or incurred and,
therefore, cannot be determined at the present time.
Liquidity Stage
Disposition Fees
Advisor or its affiliates
If our advisor or its affiliates provides a substantial amount
of services, as determined by our independent directors, in
connection with the sale of real property, 50% of a customary
and competitive real estate sales commission not to exceed 3.0%
of the contract sales price of each property sold. With respect
to a property held in a joint venture, the foregoing commission
will be reduced to a percentage of such amount reflecting our
economic interest in the joint venture.
Actual amounts depend upon the sale price of properties, and,
therefore, cannot be determined at this time.
Special UnitsTNP Strategic Retail OP Holdings
TNP Strategic Retail OP Holdings, an affiliate of our advisor,
was issued special units upon its initial investment in our
operating partnership, and as the holder of the special units
will be entitled to receive (1) 15% of specified
distributions made upon the disposition of our operating
partnerships assets, and (2) a one time payment, in
the form of shares of our common stock or a promissory note, in
conjunction with the redemption of the special units upon the
occurrence of certain liquidity events or upon the occurrence of
certain events that result in a termination or non-renewal of
our advisory agreement, but in each case only after the other
holders of our operating partnerships units, including us,
have received (or have been deemed to have received), in the
aggregate, cumulative distributions equal to their capital
contributions plus a 10.0% cumulative non-compounded annual
pre-tax return on their net contributions. The holder of special
units will not be entitled to receive any other distributions.
Actual amounts depend on the sale price of real estate assets,
and, therefore, cannot be determined at this time.
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although our advisor does not currently manage other real estate
programs, the directors, officers and key personnel of our
advisor and our affiliated property manager must allocate their
time between advising us and managing other real estate projects
and business activities in which they may be involved, including
two privately offered real estate programs sponsored by
affiliates of our advisor, all of which have investment
objectives generally similar to this offering;
the compensation payable by us to our advisor and other
affiliates may not be on terms that would result from
arms-length negotiations between unaffiliated parties, and
fees such as the acquisition fees and asset management fees
payable to our advisor and property management fees payable to
our affiliated property manager are payable, in most cases,
regardless of the quality of the assets acquired, the services
provided to us or whether we make distributions to our
stockholders;
although our sponsor and advisor have agreed generally to
provide us with the first opportunity to acquire
income-producing retail properties that meet our investment
criteria for which we have sufficient uninvested funds, our
sponsor and advisor will be required to make this determination
in good faith and will be subject to certain conflicts of
interest in recommending acquisitions on our behalf when other
affiliated programs are also seeking investments;
our property manager is an affiliate of our advisor and, as a
result, may benefit from our advisors determination to
retain our assets while our stockholders may be better served by
the sale or disposition of our assets; and
our dealer manager is an affiliate of ours and, as a result, you
will not have the benefit of an independent due diligence review
and investigation of the type normally performed by an
unaffiliated, independent underwriter in connection with a
securities offering.
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Redemption Price as a
Percentage of Purchase Price
No Redemptions
Allowed
92.5%
95.0%
97.5%
100.0%
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a merger, tender offer or proxy contest;
the assumption of control by a holder of a large block of our
securities; and
the removal of incumbent management.
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public offerings of equity by us, which allow our dealer manager
to earn additional dealer manager fees and our advisor to earn
increased acquisition fees and asset management fees;
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real property sales, since the asset management fees payable to
our advisor will decrease; and
the purchase of assets from other TNP affiliates, which may
allow our advisor or its affiliates to earn additional asset
management fees and property management fees.
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the possibility that our venture partner or co-tenant in an
investment might become bankrupt;
that the venture partner or co-tenant may at any time have
economic or business interests or goals which are, or which
become, inconsistent with our business interests or goals;
that such venture partner or co-tenant may be in a position to
take action contrary to our instructions or requests or contrary
to our policies or objectives;
the possibility that we may incur liabilities as a result of an
action taken by such venture partner;
that disputes between us and a venture partner may result in
litigation or arbitration that would increase our expenses and
prevent our officers and directors from focusing their time and
effort on our business;
the possibility that if we have a right of first refusal or
buy/sell right to buy out a co-venturer, co-owner or partner, we
may be unable to finance such a buy-out if it becomes
exercisable or we may be required to purchase such interest at a
time when it would not otherwise be in our best interest to do
so; or
the possibility that we may not be able to sell our interest in
the joint venture if we desire to exit the joint venture.
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part of the income and gain recognized by certain qualified
employee pension trusts with respect to our common stock may be
treated as unrelated business taxable income; if shares of our
common stock are predominately held by qualified employee
pension trusts, we are required to rely on a special
look-through rule for purposes of meeting one of the REIT share
ownership tests and we are not operated in a manner to avoid
treatment of such income or gain as unrelated business taxable
income;
part of the income and gain recognized by a tax exempt investor
with respect to our common stock would constitute unrelated
business taxable income if the investor incurs debt to acquire
the common stock; and
part or all of the income or gain recognized with respect to our
common stock by social clubs, voluntary employee benefit
associations, supplemental unemployment benefit trusts and
qualified group legal services plans which are exempt from
federal income taxation under Sections 501(c)(7), (9),
(17) or (20) of the Internal Revenue Code may be
treated as unrelated business taxable income.
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your investment is consistent with your fiduciary obligations
under ERISA and the Internal Revenue Code;
your investment is made in accordance with the documents and
instruments governing your plan or IRA, including your plan or
accounts investment policy;
your investment satisfies the prudence and diversification
requirements of Section 404(a)(1)(B) and 404(a)(1)(C) of
ERISA and other applicable provisions of ERISA
and/or
the
Internal Revenue Code;
your investment will not impair the liquidity of the plan or IRA;
your investment will not produce unrelated business taxable
income, referred to as UBTI for the plan or IRA;
you will be able to value the assets of the plan annually in
accordance with ERISA requirements and applicable provisions of
the plan or IRA; and
your investment will not constitute a prohibited transaction
under Section 406 of ERISA or Section 4975 of the
Internal Revenue Code.
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our ability to effectively deploy the proceeds raised in this
offering;
changes in economic conditions generally and the real estate and
debt markets specifically;
legislative or regulatory changes (including changes to the laws
governing the taxation of REITs);
the availability of capital;
interest rates; and
changes to generally accepted accounting principles.
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Maximum Primary
Minimum Primary
Maximum Primary
Offering and Distribution
Offering
Offering
Reinvestment Plan
Amount
%
Amount
%
Amount
%
$
2,000,000
100.0
%
$
1,000,000,000
100.0
%
$
1,100,000,000
100.0
%
140,000
7.0
70,000,000
7.0
70,000,000
6.4
60,000
3.0
30,000,000
3.0
30,000,000
2.7
60,000
3.0
17,500,000
1.75
17,500,000
1.6
$
1,740,000
87.0
%
$
882,500,000
88.3
%
$
982,500,000
89.3
%
43,500
2.1
22,062,500
2.2
24,562,500
2.2
8,700
0.4
4,412,500
0.4
4,912,500
0.4
$
1,687,800
84.4
%
$
856,025,000
86.0
%
$
953,025,000
86.7
%
(1)
Includes all expenses (other than sales commissions and the
dealer manager fee) to be paid by us in connection with the
offering, including our legal, accounting, printing, mailing and
filing fees, charges of our escrow agent and transfer agent,
charges of our advisor for administrative services related to
the issuance of shares of our common stock in the offering,
reimbursing the dealer manager for amounts it may pay to
reimburse the
bona fide
due diligence expenses of
broker-dealers, amounts to reimburse our advisor for the
salaries of its employees and other costs in connection with
preparing supplemental sales materials, the
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cost of educational conferences held by us and attendance fees
and cost reimbursement for employees of our affiliates to attend
retail seminars conducted by broker-dealers. Our advisor has
agreed to reimburse us to the extent such organization and
offering expenses incurred by us exceed 3.0% of aggregate gross
offering proceeds. We expect that our organization and offering
expenses will represent a lower percentage of the gross offering
proceeds as the amount of proceeds we raise in the offering
increases. In the table above, we have assumed organization and
offering expenses will constitute 3.0% of gross offering
proceeds if we raise the minimum offering amount decreasing to
1.75% of gross offering proceeds if we raise the maximum
offering amount.
(2)
Until required in connection with the acquisition of our
investments, substantially all of the net offering proceeds may
be invested in short-term, highly liquid investments, including,
but not limited to, government obligations, bank certificates of
deposit, short-term debt obligations, interest-bearing accounts
and other authorized investments as determined by our board of
directors.
(3)
This table excludes debt proceeds. To the extent we fund
property acquisitions with debt, as we expect, the amount
available for investment and the amount of acquisition fees will
be proportionately greater. This table also assumes that we will
use all net proceeds from the sale of shares under our
distribution reinvestment plan to repurchase shares under our
share redemption program. To the extent we use such net proceeds
to acquire real estate, our advisor would earn the related
acquisition fees. In addition to the acquisition fee, we may
also incur customary third-party acquisition expenses in
connection with the acquisition (or attempted acquisition) of a
real estate asset.
(4)
Amounts available for investments will include customary third
party acquisition expenses that are included in the total
acquisition costs of the real estate assets acquired. For real
estate assets that are not acquired, these costs are expensed.
Third party acquisition expenses may include legal, accounting,
consulting, appraisals, engineering, due diligence, title
insurance, closing costs and other expenses related to potential
investments regardless of whether the asset is actually
acquired. Acquisition expenses as a percentage of a real
propertys contract price vary. However, in no event will
total acquisition fees and acquisition expenses on a real
property exceed 6.0% of the contract price of the real property.
Furthermore, in no event will the total of all acquisition fees
and acquisition expenses paid by us, including acquisition
expenses on real properties which are not acquired, exceed 6.0%
of the aggregate contract price of all real properties acquired
by us. In the table above, we have assumed acquisition expenses
will constitute 0.5% of net proceeds. Although it is anticipated
that distributions will be funded from operations after we have
invested in a substantial portfolio of income-producing
investments, funds available for investment may also be used to
fund distributions to the extent that our board of directors
determines it to be appropriate, which determination will be
based, in part, upon our results of operations. We intend to
invest at least 82% of the gross offering proceeds in commercial
real properties and other real estate related assets by the
completion of the offering stage.
(5)
We do not anticipate establishing a general working capital
reserve out of the proceeds from this offering during the
initial stages of the offering. However, we may establish
working capital reserves with respect to particular investments,
to, for example, provide for maintenance and repairs of real
estate assets, leasing commissions and major capital
expenditures. Until used for such operating expenses, amounts
in our working capital reserves, if any, together with any other
proceeds not invested or used for other company purposes, will
be invested in permitted temporary investments such as
government securities.
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to preserve, protect and return stockholders capital
contributions;
to pay predictable and sustainable cash distributions to
stockholders; and
to realize capital appreciation upon the ultimate sale of the
investments we acquire.
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Denver
Las Vegas
Los Angeles/Orange County
Austin
San Francisco
Dallas
San Diego
Houston
Seattle
San Antonio
Oakland
Phoenix
Portland
Scottsdale
Salt Lake City
Albuquerque
Population as of
Population as of
Percent
October 2008
October 2020
Increase
AZ
4,335,348
6,336,859
46.17
%
AZ
987,623
1,243,028
25.86
%
CA
12,884,699
13,000,662
0.90
%
CA
4,226,125
4,503,726
6.57
%
CA
4,193,189
5,631,565
34.30
%
CA
2,988,071
3,156,321
5.63
%
CA
2,119,039
2,469,717
16.55
%
CA
1,826,754
2,123,762
16.26
%
CA
912,556
1,084,413
18.83
%
CA
812,475
1,096,515
34.96
%
CA
800,934
833,742
4.10
%
CO
2,511,098
3,111,857
23.92
%
CO
618,810
742,852
20.05
%
ID
609,726
894,796
46.75
%
NM
853,775
1,088,913
27.54
%
NV
1,901,430
2,731,129
43.64
%
OR-WA
2,215,229
2,720,033
22.79
%
TX
6,305,062
8,379,758
32.91
%
TX
5,767,212
7,565,873
31.19
%
TX
2,040,356
2,673,894
31.05
%
TX
1,658,551
2,441,377
47.20
%
UT
1,121,552
1,406,346
25.39
%
UT
530,672
694,990
30.96
%
UT
510,807
752,813
47.38
%
WA
3,357,986
3,968,915
18.19
%
66,089,079
80,653,856
22.04
%
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the propertys location and tenants;
the physical location of the property in relation to population
centers, density and accessibility;
construction quality and condition of the property;
potential for capital appreciation;
historical financial performance of the property;
rental rates and occupancy levels for the property;
potential competitors in the area; and
treatment under applicable federal, state and local tax and
other laws and regulations.
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a majority of our directors, including a majority of the
independent directors, not otherwise interested in the
transaction approve the transaction as being fair and reasonable
to us; and
the investment by us and such affiliate are on terms and
conditions that are substantially the same as those received by
the other joint venturers in such joint venture.
Our ability to manage and control the joint
venture
we will consider whether we should obtain
certain approval rights in joint ventures we do not control and
for proposed joint ventures in which we are to share control
with another entity, we will consider the procedures to address
decisions in the event of an impasse.
Our ability to exit the joint venture
we will
consider requiring buy/sell rights, redemption rights or forced
liquidation rights.
Our ability to control transfers of interests held by other
partners to the venture
we will consider requiring
consent provisions, a right of first refusal and forced
redemption rights in connection with transfers.
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plans and specifications;
environmental reports;
surveys;
evidence of marketable title subject to such liens and
encumbrances as are acceptable to our advisor;
audited financial statements covering recent operations of real
properties having operating histories unless such statements are
not required to be filed with the SEC and delivered to
stockholders; and
title and liability insurance policies.
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positioning the overall portfolio to achieve an optimal mix of
real property and real estate-related loans;
diversification benefits relative to the rest of the real
estate-related loans within our portfolio;
quality and sustainability of underlying property cash flows;
broad assessment of macro economic data and regional property
level supply and demand dynamics;
potential for delivering high current income and attractive
risk-adjusted total returns; and
additional factors considered important to meeting our
investment objectives.
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the prevailing economic, real estate and securities market
conditions;
the extent to which the investment has realized its expected
total return;
portfolio rebalancing and optimization;
diversification benefits;
opportunity to pursue a more attractive investment in real
property or in a real estate-related asset;
liquidity benefits with respect to sufficient funds for the
share redemption program; and
other factors that, in the judgment of the advisor, determine
that the sale of the investment is in our best interests.
invest in commodities or commodity futures contracts, except for
futures contracts when used solely for the purpose of hedging in
connection with our ordinary business of investing in real
property and real estate-related loans;
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invest in real estate contracts of sale, otherwise known as land
sale contracts, unless the contract is in recordable form and is
appropriately recorded in the chain of title;
make or invest in individual mortgage loans unless an appraisal
is obtained concerning the underlying property, except for those
mortgage loans insured or guaranteed by a government or
government agency. In cases where a majority of our independent
directors determines and in all cases in which the transaction
is with any of our directors or our advisor and its affiliates,
such appraisal shall be obtained from an independent appraiser.
We will maintain such appraisal in our records for at least five
years and it will be available for our stockholders
inspection and duplication. We will also obtain a
mortgagees or owners title insurance policy as to
the priority of the mortgage;
make or invest in mortgage loans that are subordinate to any
lien or other indebtedness of any of our directors, our advisor
or its affiliates;
invest in equity interests of another issuer unless a majority
of the directors (including a majority of independent directors)
not otherwise interested in the transaction approves such
investment as being fair, competitive and commercially
reasonable;
make or invest in mortgage loans, including construction loans,
on any one real property if the aggregate amount of all mortgage
loans on such real property would exceed an amount equal to 85%
of the appraised value of such real property as determined by
appraisal, unless substantial justification exists because of
the presence of other underwriting criteria;
make investments in unimproved real property mortgage loans on
unimproved real property in excess of 10.0% of our total assets;
issue equity securities redeemable solely at the option of the
holder (this limitation, however, does not limit or prohibit the
operation of our share redemption program);
issue debt securities in the absence of adequate cash flow to
cover debt service;
issue options or warrants to purchase shares to our advisor, any
of our directors or any of their respective affiliates except on
the same terms as the options or warrants are sold to the
general public, if at all, and unless the amount of the options
or warrants does not exceed an amount equal to 10% of our
outstanding shares on the date of grant of the warrants and
options;
issue shares on a deferred payment basis or under similar
arrangement;
engage in trading, except for the purpose of short-term
investments;
engage in underwriting or the agency distribution of securities
issued by others;
invest in the securities of any entity holding investments or
engaging in activities prohibited by our charter; or
make any investment that our board of directors believes will be
inconsistent with our objectives of qualifying and remaining
qualified as a REIT unless and until our board of directors
determines, in its sole discretion, that REIT qualification is
not in our best interests.
it neither is, nor holds itself out as being, engaged primarily,
nor proposes to engage primarily, in the business of investing,
reinvesting or trading in securities; or
it neither is engaged nor proposes to engage in the business of
investing, reinvesting, owning, holding or trading in securities
and does not own or propose to acquire investment
securities having a value exceeding 40% of the value of
its total assets on an unconsolidated basis, or the 40% Test.
Investment securities excludes U.S. government
securities and securities of majority-owned subsidiaries that
are not themselves investment companies and are not relying on
the exception from the definition of investment company under
Section 3(c)(1) or Section 3(c)(7) of the Investment
Company Act.
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approving and overseeing our overall investment strategy, which
will consist of elements such as investment selection criteria,
diversification strategies and asset disposition strategies;
approving any investment for a purchase price, total project
cost or sales price greater than
a
n amount equal to 10%
of the value of our net assets, including the financing of such
investments. The board of directors has delegated to the
investment committee the authority to review and approve any
acquisition, development and disposition for a purchase price,
total project cost or sales price of up to an amount equal to
10% of the value of our net assets;
approving and overseeing our debt financing strategies;
approving and monitoring the relationship between our operating
partnership and our advisor;
approving joint ventures, limited partnerships and other such
relationships with third parties;
approving a potential liquidity event;
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determining our distribution policy and authorizing
distributions from time to time; and
approving amounts available for redemptions of shares of our
common stock.
the quality and extent of the services and advice furnished by
our advisor;
the amount of fees paid to our advisor in relation to the size,
composition and performance of our investments;
the success of our advisor in generating investment
opportunities that meet our investment objectives;
rates charged to other externally advised REITs and similar
investors by advisors performing similar services;
additional revenues realized by our advisor and its affiliates
through their relationships with us, whether we pay them or they
are paid by others with whom we do business;
the performance of our investments, including income,
conservation or appreciation of capital, frequency of problem
investments and competence in dealing with distress
situations; and
the quality of our investments relative to the investments
generated by our advisor for its own account.
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62
Chairman of the Board and Chief Executive Officer
65
Vice Chairman of the Board and President
46
Chief Financial Officer, Treasurer and Secretary
73
Independent Director
40
Independent Director
49
Independent Director
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an act or omission of the director or officer was material to
the cause of action adjudicated in the proceeding and was
committed in bad faith or was the result of active and
deliberate dishonesty;
the director or officer actually received an improper personal
benefit in money, property or services; or
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with respect to any criminal proceeding, the director or officer
had reasonable cause to believe his act or omission was unlawful.
our directors and our advisor or its affiliates have determined,
in good faith, that the course of conduct that caused the loss
or liability was in our best interests;
our directors and our advisor or its affiliates were acting on
our behalf or performing services for us;
in the case of affiliated directors and our advisor or its
affiliates, the liability or loss was not the result of
negligence or misconduct;
in the case of our independent directors, the liability or loss
was not the result of gross negligence or willful
misconduct; and
the indemnification or agreement to hold harmless is recoverable
only out of our net assets and not from our stockholders.
there has been a successful adjudication on the merits of each
count involving alleged securities law violations;
such claims have been dismissed with prejudice on the merits by
a court of competent jurisdiction; or
a court of competent jurisdiction approves a settlement of the
claims against the indemnitee and finds that indemnification of
the settlement and the related costs should be made and the
court considering the request for indemnification has been
advised of the position of the SEC and of the published position
of any state securities regulatory authority in which the
securities were offered as to indemnification for violations of
securities laws.
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the legal action relates to acts or omissions with respect to
the performance of duties or services on behalf of us;
the party seeking indemnification has provided us with written
affirmation of his good faith belief that he has met the
standard of conduct necessary for indemnification;
the legal action is initiated by a third party who is not a
stockholder or the legal action is initiated by a stockholder
acting in his capacity as such and a court of competent
jurisdiction specifically approves such advancement; and
the party seeking indemnification undertakes to repay the
advanced funds to us, together with the applicable legal rate of
interest thereon, in cases in which he is found not to be
entitled to indemnification.
participate in formulating an investment strategy and asset
allocation framework consistent with achieving our investment
objectives;
research, identify, review and recommend to our board of
directors for approval investments in real properties and other
real estate-related assets and dispositions consistent with our
investment policies and objectives;
structure the terms and conditions of transactions pursuant to
which acquisitions and dispositions of investments will be made;
actively oversee and manage our portfolio of our real properties
and other real estate-related assets for purposes of meeting our
investment objectives;
manage our day-to-day affairs, including financial accounting
and reporting, investor relations, marketing, informational
systems and other administrative services on our behalf;
select joint venture partners, structure corresponding
agreements and oversee and monitor these relationships;
arrange for financing and refinancing of our
investments; and
recommend various liquidity events to our board of directors
when appropriate.
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Chief Executive Officer
President
Chief Financial Officer, Treasurer and Secretary
immediately by us for cause, or upon the bankruptcy
of our advisor;
without cause by a majority of our independent directors upon
60 days written notice; or
with good reason by our advisor upon
60 days written notice.
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Chief Executive Officer
Chief Financial Officer
Co-Chief Compliance Officer
Co-Chief Compliance Officer
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Estimated Amount
Sales Commission(1)Dealer Manager
7.0% of gross offering proceeds from the sale of shares in the
primary offering (all or a portion of which may be reallowed to
participating broker-dealers). No sales commissions will be
paid for sales pursuant to the distribution reinvestment plan.
$70,000,000
Dealer Manager Fee(1)Dealer Manager
3.0% of gross offering proceeds from the sale of shares in the
primary offering (a portion of which may be reallowed to
participating broker-dealers). No dealer manager fees will be
paid for sales pursuant to the distribution reinvestment plan.
$30,000,000
Organizational and Offering Expense
Reimbursement(2)Advisor and Dealer Manager
Reimbursement for organizational and offering expenses incurred
on our behalf, but only to the extent that the reimbursement
would not cause the organizational and offering expenses borne
by us to exceed 3.0% of the gross offering proceeds. We expect
that organizational and offering expenses will represent a lower
percentage of gross offering proceeds as the amount of proceeds
increases. Based on our current estimates, we estimate that
these expenses will represent 1.75% of gross offering proceeds,
or $17,500,000, if we raise the maximum offering.
$17,500,000
Acquisition Fees(3)Advisor
2.5% of (1) the cost of investments we acquire or (2) our
allocable cost of investments acquired in a joint venture, in
each case including purchase price, acquisition expenses and any
debt attributable to such investments. With respect to
investments in and origination of real estate-related loans, we
will pay an origination fee to our advisor in lieu of an
acquisition fee.
$24,562,500 (assuming no leverage is used). $49,125,000
(assuming a leverage ratio of 50%).
Origination Fees(3)Advisor
2.5% of the amount funded by us to acquire or originate real
estate-related loans, including third party expenses related to
such investments and any debt we use to fund the acquisition or
origination of the loan. We will not pay an acquisition fee
with respect to such real estate-related loans.
$24,562,500 (assuming no leverage is used). $49,125,000
(assuming a leverage ratio of 50%).
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Estimated Amount
Asset Management Fees(4)Advisor
A monthly amount equal to one-twelfth of 0.6% of the sum of the
aggregate cost of all assets we own and of our investments in
joint ventures, including acquisition fees, origination fees,
acquisition and origination expenses and any debt attributable
to such investments; provided, however, that our advisor will
not be paid the asset management fee until our funds from
operations exceed the lesser of (1) the cumulative amount of any
distributions declared and payable to our stockholders or (2) an
amount that is equal to a 10.0% cumulative, non-compounded,
annual return on invested capital for our stockholders.
Separate and distinct from the asset management fee, we will
also reimburse our advisor or its affiliates for all expenses
paid or incurred on our behalf, including the salaries and
benefits of persons performing services for us except for the
salaries and benefits of persons who also serve as one of our
executive officers or as an executive officer of our advisor.
Actual amounts depend upon the cost of our real estate
investments and therefore, cannot be determined at this time.
Property Management and Leasing FeesTNP Property
Management, LLC
A monthly market-based fee for property management services of
up to 5.0% of the gross revenues generated by our properties.
Our property manager may subcontract with third party property
managers and will be responsible for supervising and
compensating those property managers.
Actual amounts depend upon the gross revenue of the properties
and customary property management and leasing fees in the region
in which properties are acquired and the property types acquired
and, therefore, cannot be determined at this time.
Operating Expenses
Advisor(4)
We will reimburse our advisor for all expenses paid or incurred
by our advisor in connection with the services provided to us,
including our allocable share of the advisors overhead,
such as rent, personnel costs, utilities and IT costs. We will
not reimburse our advisor for personnel costs in connection with
services for which our advisor is entitled to acquisition,
origination or disposition fees.
Actual amounts are dependent upon expenses paid or incurred and,
therefore, cannot be determined at the present time.
Disposition Fees(5)Advisor or its affiliates
If our advisor or its affiliates provides a substantial amount
of services, as determined by our independent directors, in
connection with the sale of a real property, 50% of a customary
and competitive real estate commission not to exceed 3.0% of the
contract sales price of each property or other investment sold.
With respect to a property held in a joint venture, the
foregoing commission will be reduced to a percentage of such
amount reflecting our economic interest in the joint venture.
Actual amounts depend upon the sale price of the investments
and, therefore, cannot be determined at this time.
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Estimated Amount
Upon an advisory agreement termination event (other than for
cause, as defined in the advisory agreement), the
one-time payment to the holder of the special units will be the
amount that would have been distributed with respect to the
special units as described above under Subordinated
Participation InterestTNP Strategic Retail OP
Holdings, if our operating partnership sold all of its
assets for their then fair market values (as determined by
appraisal, except for cash and those assets that can be readily
marked to market), paid all of its liabilities and distributed
any remaining amount to the holders of common units.
(1)
The sales commission and dealer manager fee may be reduced or
waived in connection with certain categories of sales, such as
sales for which a volume discount applies, sales through
investment advisors or banks acting as trustees or fiduciaries,
sales to our affiliates and sales under our distribution
reinvestment plan.
(2)
Organization and offering expenses include all expenses (other
than sales commission and the dealer manager fee) to be paid by
us in connection with the offering, including our legal,
accounting, printing, mailing and filing fees, charges of our
escrow holder and transfer agent, charges of our advisor for
administrative services related to the issuance of shares in the
offering, reimbursement of
bona fide
due diligence
expenses of broker-dealers, reimbursement of our advisor for
costs in connection with preparing supplemental sales materials,
the cost of bona fide training and education meetings held by us
(primarily the travel, meal and lodging costs of registered
representatives of broker-dealers), attendance and sponsorship
fees and cost reimbursement for employees of our affiliates to
attend retail seminars conducted by broker-dealers and, in
special cases, reimbursement to participating broker-dealers for
technology costs associated with the offering, costs and
expenses related to such technology costs, and costs and
expenses associated with facilitation of the marketing of our
shares of common stock and the ownership of our shares of common
stock by such broker-dealers customers. Any such
reimbursement will not exceed actual expenses incurred by our
advisor. Our advisor will be responsible for the payment of our
cumulative organization and offering expenses to the extent they
exceed 3.0% of the aggregate gross proceeds from the sale of
shares of our common stock sold in the primary offering on a
best efforts basis without recourse against or reimbursement by
us.
(3)
In addition to acquisition and origination fees, we will
reimburse our advisor for amounts it pays to third parties in
connection with the selection, acquisition or development of a
property or acquisition or origination of real estate-related
loans, whether or not we ultimately acquire the property or
originate the real estate-related loans. Our charter limits our
ability to pay acquisition fees if the total of all acquisition
fees and expenses relating to the purchase would exceed 6.0% of
the contract purchase price. Under our charter, a majority of
our board of directors, including a majority of the independent
directors, would have to approve any acquisition fees (or
portion thereof) which would cause the total of all acquisition
fees and expenses relating to a real estate asset acquisition to
exceed 6.0% of the contract purchase price.
(4)
Our advisor must reimburse us at least annually for
reimbursements paid to our advisor in any year to the extent
that such reimbursements to our advisor cause our total
operating expenses to exceed the greater of (1) 2% of our
average invested assets, or (2) 25% of our net income,
unless the independent directors have determined that such
excess expenses were justified based on unusual and
non-recurring factors. Average invested assets means
the average monthly book value of our assets invested directly
or indirectly in equity interests and loans secured by real
estate during the
12-month
period before deducting depreciation, bad debts or other
non-cash reserves. Total operating expenses means
all expenses paid or incurred by us, as determined under
generally accepted accounting principles in the United States,
or GAAP, that are in any way related to our operation, including
asset management fees, but excluding (1) the expenses of
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raising capital such as organization and offering expenses,
legal, audit, accounting, underwriting, brokerage, registration
and other fees, printing and other such expenses and taxes
incurred in connection with the issuance, distribution, transfer
and registration of shares of our common stock;
(2) interest payments; (3) taxes; (4) non-cash
expenditures such as depreciation, amortization and bad debt
reserves; (5) reasonable incentive fees based on the gain
in the sale of our assets; and (6) acquisition fees,
acquisition expenses (including expenses relating to potential
acquisitions that we do not close), real estate commissions on
the resale of real property and other expenses connected with
the acquisition, disposition, management and ownership of
investments (including the costs of foreclosure, insurance
premiums, legal services, maintenance, repair and improvement of
real property).
(5)
Although we are most likely to pay disposition fees to our
advisor or one of its affiliates in our liquidity stage, these
fees may also be earned during our operational stage.
(6)
Except as described in the Management Compensation Table, TNP
Strategic Retail OP Holdings shall not be entitled to receive
any redemption or other payment from us or our operating
partnership, including any participation in the monthly
distributions we intend to make to our stockholders.
(7)
TNP Strategic Retail OP Holdings cannot earn both the
subordinated participation in net sale proceeds and the
subordinated distribution upon listing of our common stock on a
national securities exchange or the termination or non-renewal
of the advisory agreement.
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the continuation, renewal or enforcement of our agreements with
our advisor and its affiliates, including the advisory agreement
and the property management agreement, and the agreement with
our dealer manager;
transactions with affiliates, including our directors and
officers;
awards under our long-term incentive plan; and
pursuit of a potential liquidity event.
the quality and extent of the services and advice furnished by
our advisor;
the amount of fees paid to our advisor in relation to the size,
composition and performance of our investments;
the success of our advisor in generating investment
opportunities that meet our investment objectives;
rates charged to other externally advised REITs and similar
investors by advisors performing similar services;
additional revenues realized by our advisor and its affiliates
through their relationship with us, whether we pay them or they
are paid by others with whom we do business;
the performance of our investments, including income,
conservation and appreciation of capital, frequency of problem
investments and competence in dealing with distress situations;
and
the quality of our investments relative to the investments
generated by our advisor for its own account.
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Private Fund
2008
Operating
Private Fund
2008
Operating
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Properties Purchased
(as a Percentage of
Aggregate Purchase Price)
100
%
65
%
33
%
2
New
Existing
Construction
88
%
8
%
2
2
%
98
%
2
%
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Number of Properties
2
2
1
1
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No. of
Properties
97
22
1
1
1
122
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No. of
Properties
4
1
20
6
11
8
1
1
1
2
3
2
4
2
8
3
2
3
2
3
31
1
2
1
122
No. of
Properties
0
7
115
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FINANCIAL CONDITION AND RESULTS OF OPERATIONS
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5-40 years
10-20 years
5-10 years
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current cash balances;
public offerings;
various forms of secured financing;
borrowings under master repurchase agreements;
equity capital from joint venture partners;
proceeds from our operating partnerships private
placements;
proceeds from our distribution reinvestment plan; and
cash from operations.
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expenses relating to the formation and continuity of our
existence;
expenses relating to our public offering and registration of
securities;
expenses associated with the preparation and filing of any
periodic reports by us under federal, state or local laws or
regulations;
expenses associated with compliance by us with applicable laws,
rules and regulations; and
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our other operating or administrative costs incurred in the
ordinary course of our business on behalf of our operating
partnership.
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Number of Shares
Percent of
Beneficially Owned
All Shares
22,222
100
%
22,222
100
%
22,222
100
%
(1)
Under SEC rules, a person is deemed to be a beneficial
owner of a security if that person has or shares
voting power, which includes the power to dispose of
or to direct the disposition of such security. A person also is
deemed to be a beneficial owner of any securities which that
person has a right to acquire within 60 days. Under these
rules, more than one person may be deemed to be a beneficial
owner of the same securities and a person may be deemed to be a
beneficial owner of securities as to which he or she has no
economic or pecuniary interest.
(2)
As of the date of this prospectus, Thompson National Properties,
LLC owns all of our issued and outstanding stock.
Mr. Thompson is the managing member of Thompson National
Properties, LLC.
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Redemption Price as a
No Redemptions
Allowed
92.5%
95.0%
97.5%
100.0%
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the special committee receives an opinion from a qualified
investment banking firm, separate and distinct from the firm
jointly retained by us and our advisor to provide a valuation
analysis, concluding that the consideration to be paid to
acquire our advisor is fair to our stockholders from a financial
point of view;
our board of directors determines that such business combination
is advisable and in our best interests and in the best interests
of our stockholders; and
such business combination is approved by our stockholders
entitled to vote thereon in accordance with our charter and
bylaws.
one-tenth or more but less than one-third;
one-third or more but less than a majority; or
a majority or more of all voting power.
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a classified board of directors;
a two-thirds vote requirement for removing a director;
a requirement that the number of directors be fixed only by vote
of the directors;
a requirement that vacancies on the board of directors be filled
only by the remaining directors and for the remainder of the
full term of the class of directors in which the vacancy
occurred; and
a majority requirement for the calling of a special meeting of
stockholders.
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a transaction involving our securities that have been listed on
a national securities exchange for at least
12 months; or
a transaction involving our conversion into corporate or
association form if, as a consequence of the transaction, there
will be no significant adverse change in any of the following:
our common stockholder voting rights; the term of our existence;
compensation to our advisor or its affiliates; or our investment
objectives.
accepting the securities of the
roll-up
entity offered in the proposed
roll-up
transaction; or
one of the following:
remaining as stockholders and preserving their interests on the
same terms and conditions as existed previously; or
receiving cash in an amount equal to the stockholders pro
rata share of the appraised value of our net assets.
that would result in our common stockholders having voting
rights in a
roll-up
entity that are less than those provided in our bylaws and
described elsewhere in this prospectus including rights with
respect to the election and removal of directors, annual and
special meetings, amendment of our declaration of trust and our
dissolution;
that includes provisions that would operate to materially impede
or frustrate the accumulation of shares by any purchaser of the
securities of the
roll-up
entity, except to the minimum extent necessary to preserve the
tax status of the
roll-up
entity, or which would limit the ability of an investor to
exercise voting rights of its securities of the
roll-up
entity on the basis of the number of shares held by that
investor;
in which investors right to access of records of the
roll-up
entity will be less than those provided in the section of this
prospectus entitled Description of Capital
Stock; or
in which any of the costs of the
roll-up
transaction would be borne by us if the
roll-up
transaction is rejected by our common stockholders.
financial statements that are prepared in accordance with GAAP
and are audited by our independent registered public accounting
firm;
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the ratio of the costs of raising capital during the year to the
capital raised;
the aggregate amount of asset management fees and the aggregate
amount of other fees paid to our advisor and any affiliate of
our advisor by us or third parties doing business with us during
the year;
our total operating expenses for the year, stated as a
percentage of our average invested assets and as a percentage of
our net income;
a report from the independent directors that our policies are in
the best interests of our stockholders and the basis for such
determination; and
separately stated, full disclosure of all material terms,
factors and circumstances surrounding any and all transactions
involving us and our advisor, a director or any affiliate
thereof during the year; and the independent directors are
specifically charged with a duty to examine and comment in the
report on the fairness of the transactions.
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we will be taxed at regular corporate rates on our undistributed
REIT taxable income, including undistributed net capital gains;
under some circumstances, we may be subject to alternative
minimum tax;
if we have net income from prohibited transactions (which are,
in general, sales or other dispositions of property, other than
foreclosure property, held primarily for sale to customers in
the ordinary course of a trade or business), the income will be
subject to a 100% tax;
if we elect to treat property that we acquire in connection with
a foreclosure of a mortgage loan or certain leasehold
terminations as foreclosure property, we may avoid
the 100% tax on gain from a resale of that property (if the sale
would otherwise constitute a prohibited transaction), but the
income from the sale or operation of the property may be subject
to corporate income tax at the highest applicable rate
(currently 35%);
pursuant to provisions in recently enacted legislation, if we
should fail to satisfy the asset or other requirements
applicable to REITs, as described below, yet nonetheless
maintain our qualification as a REIT because there is reasonable
cause for the failure and other applicable requirements are met,
we may be subject to an excise tax. In that case, the amount of
the tax will be at least $50,000 per failure, and, in the case
of certain asset test failures, will be determined as the amount
of net income generated by the assets in question multiplied by
the highest corporate tax rate (currently 35%) if that amount
exceeds $50,000 per failure;
if we fail to satisfy either the 75% or 95% Income Test (defined
below) but have nonetheless maintained our qualification as a
REIT because certain conditions have been met, we will be
subject to a 100% tax on an amount based on the magnitude of the
failure adjusted to reflect the profit margin associated with
our gross income;
if we fail to distribute during each year at least the sum of
(1) 85% of our REIT ordinary income for the year,
(2) 95% of our REIT capital gain net income for such year
and (3) any undistributed taxable income from prior
periods, we will be subject to a 4% excise tax on the excess of
the required distribution over the sum of (a) the amounts
actually distributed plus (b) retained amounts on which
corporate level tax is paid by us;
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we may elect to retain and pay tax on our net long-term capital
gain. In that case, a United States stockholder would be taxed
on its proportionate share of our undistributed long-term
capital gain and would receive a credit or refund for its
proportionate share of the tax we paid;
if we fail certain of the REIT asset tests and do not qualify
for de minimis relief, we may be required to pay a
corporate level tax on the income generated by the assets that
caused us to violate the asset test;
if we acquire appreciated assets from a C corporation (such as a
corporation generally subject to corporate level tax) in a
transaction in which the C corporation would not normally be
required to recognize any gain or loss on disposition of the
asset and we subsequently recognize gain on the disposition of
the asset during the ten-year period beginning on the date on
which we acquired the asset, then a portion of the gain may be
subject to tax at the highest regular corporate rate, unless the
C corporation made an election to treat the asset as if it
were sold for its fair market value at the time of our
acquisition; and
income earned by any of our taxable REIT subsidiaries will be
subject to tax at regular corporate rates.
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At least 75% of our gross income, excluding gross income from
prohibited transactions, for each taxable year must be derived
directly or indirectly from investments relating to real
property or mortgages on real property and from other specified
sources, including qualified temporary investment income, as
described below. Gross income includes rents from real
property and, in some circumstances, interest, but
excludes gross income from dispositions of property held
primarily for sale to customers in the ordinary course of a
trade or business. These dispositions are referred to as
prohibited transactions. This test is the 75% Income
Test.
At least 95% of our gross income, excluding gross income from
prohibited transactions, for each taxable year must be derived
from the real property investments described above and generally
from distributions and interest and gains from the sale or
disposition of shares of our common stock or securities or from
any combination of the foregoing. This test is the 95% Income
Test.
the amount of rent received from a customer must not be based in
whole or in part on the income or profits of any person;
however, an amount received or accrued generally will not be
excluded from the term rents from real property
solely by reason of being based on a fixed percentage or
percentages of gross receipts or sales;
in general, neither we nor an owner of 10% or more of the shares
of our common stock may directly or constructively own 10% or
more of a customer, which we refer to as a Related Party
Customer, or a subtenant of the customer (in which case
only rent attributable to the subtenant is disqualified);
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rent attributable to personal property leased in connection with
a lease of real property cannot be greater than 15% of the total
rent received under the lease, as determined based on the
average of the fair market values as of the beginning and end of
the taxable year; and
we normally must not operate or manage the property or furnish
or render services to customers, other than through an
independent contractor who is adequately compensated
and from whom we do not derive any income or through a
taxable REIT subsidiary. However, a REIT may provide
services with respect to its properties, and the income derived
therefrom will qualify as rents from real property,
if the services are usually or customarily rendered
in connection with the rental of space only and are not
otherwise considered rendered to the occupant
primarily for its convenience. Even if the services provided by
us with respect to a property are impermissible customer
services, the income derived therefrom will qualify as
rents from real property if such income does not
exceed one percent of all amounts received or accrued with
respect to that property.
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our failure to meet these tests was due to reasonable cause and
not due to willful neglect;
we attach a schedule of our income sources to our federal income
tax return; and
any incorrect information on the schedule is not due to fraud
with intent to evade tax.
First, at least 75% of the value of our total assets must be
represented by real estate assets, cash, cash items and
government securities. The term real estate assets
includes real property, mortgages on real property, shares of
common stock in other qualified REITs, property attributable to
the temporary investment of new capital as described above and a
proportionate share of any real estate assets owned by a
partnership in which we are a partner or of any qualified REIT
subsidiary of ours.
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Second, no more than 25% of our total assets may be represented
by securities other than those in the 75% asset class.
Third, of the investments included in the 25% asset class, the
value of any one issuers securities that we own may not
exceed 5% of the value of our total assets. Additionally, we may
not own more than 10% of the voting power or value of any one
issuers outstanding securities, which we refer to as the
10% Asset Test. The 10% Asset Test does not apply to
securities of a taxable REIT subsidiary, nor does it apply to
certain straight debt instruments possessing certain
characteristics. The term securities also does not
include the equity or debt securities of a qualified REIT
subsidiary of ours or an equity interest in any entity treated
as a partnership for federal tax purposes.
Fourth, no more than 25% of the value of our total assets may
consist of the securities of one or more taxable REIT
subsidiaries. Subject to certain exceptions, a taxable REIT
subsidiary is any corporation, other than a REIT, in which we
directly or indirectly own stock and with respect to which a
joint election has been made by us and the corporation to treat
the corporation as a taxable REIT subsidiary of ours and also
includes any corporation, other than a REIT, in which a taxable
REIT subsidiary of ours owns, directly or indirectly, more than
35% of the voting power or value.
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85% of our ordinary income for that year;
95% of our capital gain net income other than the capital gain
net income which we elect to retain and pay tax on for that
year; and
any undistributed taxable income from prior periods;
we would be required to pay the federal income tax on these
gains;
taxable U.S. stockholders, while required to include their
proportionate share of the undistributed long-term capital gains
in income, would receive a credit or refund for their share of
the tax paid by the REIT; and
the basis of the stockholders shares of common stock would
be increased by the difference between the designated amount
included in the stockholders long-term capital gains and
the tax deemed paid with respect to such shares of common stock.
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a citizen or resident of the United States;
a corporation, partnership or other entity treated as a
corporation or partnership for U.S. federal income tax
purposes created or organized in or under the laws of the United
States or of any political subdivision thereof;
an estate, the income of which is subject to U.S. federal
income taxation regardless of its source; or
a trust, if a U.S. court is able to exercise primary
supervision over the administration of the trust and one or more
U.S. persons have the authority to control all substantial
decisions of the trust.
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fails to furnish its taxpayer identification number (which, for
an individual, would be his Social Security number);
furnishes an incorrect taxpayer identification number;
is notified by the Internal Revenue Service that the stockholder
has failed properly to report payments of interest or
distributions and is subject to backup withholding; or
under some circumstances, fails to certify, under penalties of
perjury, that it has furnished a correct taxpayer identification
number and has not been notified by the Internal Revenue Service
that the stockholder is subject to backup withholding for
failure to report interest and distribution payments or has been
notified by the Internal Revenue Service that the stockholder is
no longer subject to backup withholding for failure to report
those payments.
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whether the investment is consistent with the applicable
provisions of ERISA and the Internal Revenue Code;
whether, under the facts and circumstances pertaining to the
benefit plan in question, the fiduciarys responsibility to
the plan has been satisfied;
whether the investment will produce UBTI to the benefit
plan; and
the need to value the assets of the benefit plan annually.
to act solely in the interest of plan participants and
beneficiaries and for the exclusive purpose of providing
benefits to them, as well as defraying reasonable expenses of
plan administration;
to invest plan assets prudently;
to diversify the investments of the plan, unless it is clearly
prudent not to do so;
to ensure sufficient liquidity for the plan;
to ensure that plan investments are made in accordance with plan
documents; and
to consider whether an investment would constitute or give rise
to a prohibited transaction under ERISA or the Internal Revenue
Code.
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sold as part of a public offering registered under the
Securities Act, and be part of a class of securities registered
under the Securities Exchange Act, within a specified time
period;
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part of a class of securities that is owned by 100 or more
persons who are independent of the issuer and one
another; and
freely transferable.
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Maximum
Percent of
Gross Offering
Proceeds
7.0
%
3.0
%
1.75
%
11.75
%
(1)
Organization and offering expenses include all expenses (other
than sales commission and the dealer manager fee) to be paid by
us in connection with the offering, including our legal,
accounting, printing, mailing and filing fees, charges of our
escrow holder and transfer agent, charges of our advisor for
administrative services related to the issuance of shares in the
offering, reimbursement of
bona fide
due diligence
expenses of broker-dealers, reimbursement of our advisor for
costs in connection with preparing supplemental sales materials,
the cost of
bona fide
training and education meetings
held by us (primarily the travel, meal and lodging costs of
registered representatives of broker-dealers), attendance and
sponsorship fees and cost reimbursement for employees of our
affiliates to attend retail seminars conducted by broker-dealers
and, in special cases, reimbursement to participating
broker-dealers for technology costs associated with the
offering, costs and expenses related to such technology costs,
and costs and expenses associated with facilitation of the
marketing of our shares of common stock and the ownership of our
shares of common stock by such broker-dealers customers.
Our advisor will be responsible for the payment of our
cumulative organization and offering expenses, to the extent
they exceed 3.0% of the aggregate gross offering proceeds, or
$30,000,000, from the sale of shares of our common stock sold in
the primary offering without recourse against or reimbursement
by us.
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Purchase
Percentage
Price per
(Based
Dealer
Net
Dollar Volume of
Share to
on $10.00/
Amount
Manager Fee
Proceeds
Investor
Share)
per Share
per Share
per Share
$
10.00
7.0
%
$
0.70
$
0.30
$
9.00
$
9.90
6.0
%
$
0.60
$
0.30
$
9.00
$
9.80
5.0
%
$
0.50
$
0.30
$
9.00
$
9.70
4.0
%
$
0.40
$
0.30
$
9.00
$
9.60
3.0
%
$
0.30
$
0.30
$
9.00
$
9.50
2.0
%
$
0.02
$
0.30
$
9.00
An individual, his or her spouse and their children under the
age of 21 who purchase the shares for his, her or their own
accounts;
A corporation, partnership, association, joint-stock company,
trust fund or any organized group of persons, whether
incorporated or not;
An employees trust, pension, profit sharing or other
employee benefit plan qualified under Section 401(a) of the
Internal Revenue Code; and
All commingled trust funds maintained by a given bank.
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TNP Strategic Retail Trust, Inc.:
as to the change in accounting
policy described in Note 2)
F-2
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December 31, 2008
(Unaudited)
$
201,839
$
201,429
161
571
$
202,000
$
202,000
$
$
222
222
199,778
199,778
200,000
200,000
2,000
2,000
202,000
202,000
$
202,000
$
202,000
F-3
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For the Period from
October 16, 2008
For the Three Months
(Date of Inception) through
Ended March 31, 2009
December 31, 2008
(Unaudited)
$
$
$
$
$
$
22,222
22,222
$
$
F-4
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Additional
Number of
Paid-in
Stockholders
Noncontrolling
Shares
Par Value
Capital
Equity
Interest
Total
$
$
$
$
$
22,222
$
222
$
199,778
$
200,000
$
200,000
$
2,000
$
2,000
22,222
222
199,778
200,000
2,000
202,000
22,222
$
222
$
199,778
$
200,000
$
2,000
$
202,000
F-5
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For the Period from
October 16, 2008
For the Three Months
(Date of Inception) through
Ended March 31, 2009
December 31, 2008
(Unaudited)
$
$
410
(571
)
410
(571
)
200,000
2,000
202,000
410
201,429
201,429
$
201,839
$
201,429
$
$
F-6
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through December 31, 2008
1.
Organization
2.
Summary
of Significant Accounting Policies
F-7
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F-8
Table of Contents
5-40 years
10-20 years
5-10 years
F-9
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F-10
Table of Contents
F-11
Table of Contents
3.
Capitalization
4.
Related
Party Arrangements
F-12
Table of Contents
5.
Incentive
Award Plan
6.
Subordinated
Participation Interest
F-13
Table of Contents
Table of Contents
Bruin Fund, L.P.
(Oakwood &
TNP Vulture
One Lee Park)
Fund VIII, LLC
Total
5/9/2008
6/23/2008
$
3,950,000
$
5,348,085
$
9,298,085
$
$
$
$
$
$
250,000
$
110,250
$
360,250
$
$
43,526
$
43,526
$
250,000
$
153,776
$
403,776
$
869,478
$
282,141
$
1,151,619
$
51,401
$
2,797
$
54,197
$
14,833
$
$
14,833
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
A-2
Table of Contents
SALE OR DISPOSITION OF PROPERTIES
Cost of Properties Including Closing and Soft Costs
Excess (Deficiency)
Selling Price, Net of Closing Costs and GAAP Adjustments
Total
of Property
Purchase Money
Adjustments
Acquisition
Operating Cash
Cash Received
Mortgage
Mortgage Taken
Resulting From
Original
Cost, Closing
Receipts Over
Date
Net of
Balance at
Back By
Application of
Mortgage
and Soft
Cash
Acquired
Date of Sale(1)
Closing Costs
Time of Sale
Program(2)
GAAP
Total(3)
Financing
Cost
Total
Expenditures Total
10/3/2008
12/19/2008
$
5,000,000
$
11,074,095
$
$
$
5,000,000
$
11,074,095
$
10,826,742
$
21,900,837
$
(227,625.31
)
(1)
Sale of 45.47% interest in VF Carson, LLC by TNP Vulture
Fund VIII, LLC to TNP SLI Green Building Fund, LP, an
affiliate of Thompson National Properties, LLC. TNP Vulture
Fund VIII, LLC continues to hold a 54.53% interest in VF
Carson, LLC. VF Carson LLC is the sole owner of
302 E. Carson, Las Vegas, Nevada.
(2)
No purchase money mortgages were taken back in the program.
(3)
This represents the amount of cash that TNP Vulture
Fund VIII, LLC received from the sale of the 45.47%
interest in VF Carson, LLC.
A-3
Table of Contents
Table II Compensation to Sponsor (Unaudited)
Table III Annual Operating Results of Prior
Programs (Unaudited)
Table IV Results of Completed Programs
(Unaudited)
Table V Sales or Disposals of Properties (Unaudited)
B-1
Table of Contents
The primary difference between the cash methods of accounting
and accrual methods (both GAAP and the accrual method of
accounting for income tax purposes) is that the cash method of
accounting generally reports income when received and expenses
when paid while the accrual method generally requires income to
be recorded when earned and expenses recognized when incurred.
GAAP requires that, when reporting lease revenue, the minimum
annual rental revenue be recognized on a straight-line basis
over the term of the related lease, whereas the cash method of
accounting for income tax purposes requires recognition of
income when cash payments are actually received from tenants,
and the accrual method of accounting for income tax purposes
requires recognition of income when the income is earned
pursuant to the lease contract.
GAAP requires that when an asset is considered held for sale,
depreciation ceases to be recognized on that asset, whereas for
income tax purposes, depreciation continues until the asset
either is sold or is no longer in service.
GAAP requires that when a building is purchased certain
intangible assets and liabilities (such as above-and
below-market leases, tenant relationships and in-place lease
costs) are allocated separately from the building and are
amortized over significantly shorter lives than the depreciation
recognized on the building. These intangible assets and
liabilities are not recognized for income tax purposes and are
not allocated separately from the building for purposes of tax
depreciation.
GAAP requires that an asset is considered impaired when the
carrying amount of the asset is greater than the sum of the
future undiscounted cash flows expected to be generated by the
asset, and an impairment loss must then be recognized to
decrease the value of the asset to its fair value. For income
tax purposes, losses are generally not recognized until the
asset has been sold to an unrelated party or otherwise disposed
of in an arms length transaction.
B-2
Table of Contents
NNN
Public
Initial Offering
Second Offering
2003 Value
Program
G REIT, Inc.
G REIT, Inc.
Fund, LLC
Totals
$
200,000,000
$
270,000,000
$
50,000,000
$
520,000,000
200,000,000
237,315,000
50,000,000
487,315,000
100.0
%
87.9
%
100.0
%
93.7
%
7.5
%
7.0
%
8.0
%
2.0
%
3.0
%
2.5
%
2.5
%
2.0
%
2.5
%
0.0
%
0.0
%
0.0
%
0.0
%
0.0
%
8.0
%
88.0
%
88.0
%
79.0
%
87.5
%
87.5
%
71.0
%
0.0
%
0.0
%
2.5
%
0.5
%
0.5
%
5.5
%
88.0
%
88.0
%
79.0
%
49.7
%
49.7
%
51.7
%
22-Jul-02
23-Jan-04
11-Jul-03
9-Feb-04
30-Apr-04
14-Oct-04
19
3
15
18
N/A
14
13,867
(3)
13,867
(3)
826
(1)
Includes legal, accounting, printing and other offering
expenses, including amounts for the reimbursement for marketing,
salaries and direct expenses of employees engaged in marketing
and other organization expenses.
(2)
Nonaccountable due diligence reimbursement to selling group.
(3)
Total number of investors for Initial Offering and Second
Offering at December 31, 2006.
B-3
Table of Contents
Other Programs
G REIT,
NNN 2003
NNN 2002
Grubb & Ellis Apartment
Total
Inc.
Value Fund, LLC
Subtotal
T REIT, Inc
Value Fund, LLC
REIT, Inc.
All Programs
22-Jul-02
11-Jul-03
22-Feb-00
15-May-02
19-Jul-06
$
437,315,000
$
50,000,000
$
487,315,000
$
46,395,000
$
29,799,000
$
16,568,000
(1)
$
580,077,000
$
30,443,000
$
3,898,000
$
34,341,000
$
3,576,000
$
2,089,000
$
1,141,000
$
41,147,000
10,818,000
1,251,000
12,069,000
671,000
2,005,000
411,000
15,156,000
3,036,000
1,394,000
4,430,000
860,000
249,000
249,000
5,788,000
83,000
83,000
1,000
1,000
1,783,000
1,783,000
1,192,000
2,975,000
$
44,297,000
$
8,326,000
$
52,623,000
$
5,107,000
$
5,536,000
$
1,884,000
$
65,150,000
$
13,763,000
$
2,041,000
$
15,804,000
$
585,000
$
$
1,884,000
$
18,273,000
$
81,585,000
(2)
$
755,000
$
82,340,000
$
5,853,000
(3)
$
8,395,000
(4)
$
325,000
$
96,913,000
$
4,293,000
$
272,000
$
4,565,000
$
343,000
$
840,000
$
$
5,748,000
801,000
801,000
48,000
630,000
1,479,000
$
5,094,000
$
272,000
$
5,366,000
$
391,000
$
1,470,000
$
$
7,227,000
$
5,617,000
$
268,000
$
5,885,000
$
291,000
$
477,000
$
$
6,653,000
2,756,000
747,000
3,503,000
349,000
86,000
3,938,000
$
8,373,000
$
1,015,000
$
9,388,000
$
640,000
$
563,000
$
$
10,591,000
$
4,811,000
$
596,000
$
5,407,000
$
84,000
$
24,000
$
5,515,000
265,000
265,000
3,705,000
947,000
4,652,000
4,652,000
$
8,516,000
$
1,543,000
$
10,059,000
$
349,000
$
$
24,000
$
10,432,000
$
7,828,000
1,069,000
$
8,897,000
$
1,700,000
$
1,280,000
$
$
11,877,000
173,000
173,000
173,000
107,000
107,000
107,000
$
7,828,000
$
1,349,000
$
9,177,000
$
1,700,000
$
1,280,000
$
$
12,157,000
(1)
Amount is as of December 31, 2006 as the offering has not
closed. Such amount excludes amounts issued under the
distribution reinvestment plan.
(2)
Amount for G REIT, Inc. represents cash generated from
operations for the two years ended December 31, 2005, plus
payments to the sponsor from operations for the three years
ended December 31, 2006 due to the adoption of the
liquidation basis of accounting as of December 31, 2005.
(3)
Amount for T REIT, Inc. represents cash generated from
operations for the period from January 1, 2005 through
June 30, 2005 and the year ended December 31, 2004,
plus payments to the sponsor from operations for the three years
ended December 31, 2006 due to the adoption of the
liquidation basis of accounting as of June 30, 2005.
(4)
Amount for NNN 2002 Value Fund, LLC represents cash generated
from operations for the period from January 1, 2005 through
August 31, 2005 and the year ended December 31, 2004,
plus payments to the sponsor from operations for the three years
ended December 31, 2006 due to the adoption of the
liquidation basis of accounting as of August 31, 2005.
B-4
Table of Contents
Year Ended December 31,
2005(4)
2004
2003
2002
Total
$
$
$
$
$
10,682,000
980,000
11,662,000
445,000
332,000
117,000
17,000
911,000
440,000
251,000
691,000
1,337,000
(604,000
)
204,000
937,000
(4,215,000
)
1,225,000
1,337,000
166,000
(1,487,000
)
4,006,000
2,419,000
1,287,000
142,000
7,854,000
2,054,000
1,243,000
293,000
15,000
3,605,000
398,000
398,000
$
2,629,000
$
(1,876,000
)
$
78,000
$
26,000
$
857,000
2,511,000
11,273,000
1,083,000
(16,000
)
14,851,000
11,963,000
251,000
12,214,000
19,697,000
39,905,000
7,878,000
(609,000
)
66,871,000
80,432,000
(563,218,000
)
(291,418,000
)
(26,101,000
)
(800,305,000
)
(76,789,000
)
552,058,000
296,053,000
35,259,000
806,581,000
23,340,000
28,745,000
12,513,000
8,549,000
73,147,000
19,023,000
26,335,000
5,285,000
50,643,000
674,000
376,000
74,000
1,124,000
13,865,000
170,000
14,035,000
(10,222,000
)
2,034,000
7,154,000
8,379,000
7,345,000
$
(10,222,000
)
$
2,034,000
$
7,154,000
$
8,379,000
$
7,345,000
B-5
Table of Contents
Year Ended December 31,
2005(4)
2004
2003
2002
$
5.72
$
30.19
$
13.14
$
(3.95
)
27.27
0.67
43.37
70.54
64.12
31.61
41.98
43.37
70.54
64.12
$
31.61
$
$
$
41.98
$
$
236,109,000
$
138,305,000
$
18,604,000
B-6
Table of Contents
Period from
January 1, 2005
through
Year Ended December 31,
June 30, 2005(4)
2004
2003
2002
Total
$
$
$
$
$
191,000
2,466,000
2,614,000
213,000
5,484,000
285,000
622,000
181,000
281,000
1,369,000
126,000
109,000
235,000
787,000
581,000
1,160,000
1,126,000
3,654,000
(272,000
)
31,000
1,076,000
1,241,000
2,076,000
1,013,000
1,213,000
792,000
558,000
3,576,000
44,000
52,000
50,000
10,000
156,000
$
60,000
$
2,544,000
$
4,189,000
$
2,293,000
$
9,086,000
157,000
1,197,000
(1,100,000
)
(683,000
)
(429,000
)
614,000
2,545,000
2,547,000
284,000
5,990,000
883,000
3,590,000
2,950,000
2,290,000
9,713,000
249,000
(14,333,000
)
2,517,000
(19,279,000
)
(30,846,000
)
(120,000
)
9,731,000
4,439,000
22,334,000
36,384,000
1,012,000
(1,012,000
)
9,906,000
5,345,000
15,251,000
792,000
3,438,000
2,950,000
2,290,000
9,470,000
91,000
152,000
243,000
1,118,000
358,000
896,000
573,000
2,945,000
(989,000
)
(4,960,000
)
6,060,000
2,482,000
2,593,000
$
(989,000
)
$
(4,960,000
)
$
6,060,000
$
2,482,000
$
2,593,000
B-7
Table of Contents
Period from
January 1, 2005
through
Year Ended December 31,
June 30, 2005(4)
2004
2003
2002
$
3.41
$
25.85
$
(23.52
)
$
(17.02
)
13.33
54.97
54.47
7.08
17.20
74.25
63.09
57.06
24.28
7.73
19.16
14.28
17.20
74.25
63.09
57.06
$
24.28
$
7.73
$
19.16
$
14.28
$
$
$
$
19,343,000
B-8
Table of Contents
Period from June 19, 2003
(Date of Inception)
Year Ended December 31,
through
2006
2005
2004
December 31, 2003
Total
$
3,742,000
$
1,262,000
$
653,000
$
$
5,657,000
7,056,000
5,802,000
12,858,000
527,000
416,000
86,000
3,000
1,032,000
134,000
344,000
478,000
(1,139,000
)
2,510,000
(682,000
)
(132,000
)
557,000
(1,314,000
)
670,000
(145,000
)
(789,000
)
2,599,000
1,203,000
1,084,000
11,000
4,897,000
754,000
1,289,000
339,000
7,000
2,389,000
2,680,000
768,000
638,000
4,086,000
2,611,000
665,000
286,000
3,562,000
(19,000
)
166,000
(133,000
)
(31,000
)
(17,000
)
$
381,000
$
6,913,000
$
(2,302,000
)
$
(116,000
)
$
4,876,000
(1,954,000
)
95,000
680,000
231,000
(948,000
)
5,952,000
3,354,000
9,306,000
(4,789,000
)
238,000
2,476,000
174,000
(1,901,000
)
15,867,000
(64,529,000
)
(45,158,000
)
(9,932,000
)
(103,752,000
)
(12,015,000
)
70,050,000
52,269,000
12,437,000
122,741,000
(937,000
)
5,759,000
9,587,000
2,679,000
17,088,000
1,908,000
35,000
1,943,000
238,000
408,000
19,000
665,000
9,179,000
4,657,000
13,836,000
(10,116,000
)
864,000
7,271,000
2,625,000
644,000
$
(10,116,000
)
$
864,000
$
7,271,000
$
2,625,000
$
644,000
B-9
Table of Contents
Period from June 19, 2003
(Date of Inception)
Year Ended December 31,
through
2006
2005
2004
December 31, 2003
$
(39.17
)
$
1.90
$
22.09
$
71.19
119.33
67.08
61.97
10.79
120.23
69.86
61.97
10.79
$
120.23
$
69.86
$
$
(1)
Includes amortization of deferred financing costs.
(2)
Cash Distributions per $1,000 invested excludes distributions to
minority interests.
(3)
Includes cash distributions of $3,182,000 and $1,164,000 to
minority interests for the year ended December 31, 2006 and
2005, respectively.
(4)
Pursuant to NNN 2003 Value Fund, LLCs Operating Agreement,
cash proceeds from capital transactions are first treated as a
return of capital.
B-10
Table of Contents
Period from
Period from May 15, 2002
January 1, 2005
(Date of Inception)
through
Year Ended December 31,
through
August 31, 2005(3)
2004
2003
December 31, 2002
Total
$
$
$
$
$
6,674,000
6,674,000
76,000
6,000
46,000
2,000
130,000
373,000
(278,000
)
84,000
179,000
1,049,000
196,000
(596,000
)
(109,000
)
540,000
15,000
99,000
69,000
25,000
208,000
3,000
9,000
40,000
52,000
$
8,154,000
$
(184,000
)
$
(535,000
)
$
(172,000
)
$
7,263,000
143,000
732,000
137,000
132,000
1,144,000
14,843,000
14,843,000
3,378,000
2,984,000
2,140,000
698,000
9,200,000
22,977,000
(2,170,000
)
(47,060,000
)
(7,959,000
)
(34,212,000
)
(8,626,000
)
2,068,000
44,416,000
11,619,000
49,477,000
17,729,000
2,882,000
(504,000
)
4,358,000
24,465,000
2,726,000
2,027,000
1,693,000
35,000
6,481,000
652,000
957,000
447,000
2,056,000
10,330,000
410,000
100,000
10,840,000
4,021,000
(512,000
)
(2,744,000
)
4,323,000
5,088,000
$
4,021,000
$
(512,000
)
$
(2,744,000
)
$
4,323,000
$
5,088,000
B-11
Table of Contents
Period from
Period from May 15, 2002
January 1, 2005
(Date of Inception)
through
Year Ended December 31,
through
August 31, 2005(3)
2004
2003
December 31, 2002
$
4.80
$
24.56
$
5.64
$
67.35
498.09
91.48
68.02
69.71
17.86
346.64
13.76
4.12
91.48
68.02
69.71
17.86
$
346.64
$
13.76
$
4.12
$
(1)
Includes amortization of deferred financing costs.
(2)
Cash Distributions per $1,000 invested excludes distributions to
minority interests.
(3)
The program adopted the liquidation basis of accounting as of
August 31, 2005 and for all subsequent periods. However,
the taxable income numbers are for the year ended
December 31, 2005, as the liquidation basis of accounting
is not applicable for income tax purposes.
(4)
Pursuant to NNN 2002 Value Fund, LLCs Operating Agreement,
cash proceeds from capital transactions are first treated as a
return of capital.
B-12
Table of Contents
Cost of Properties
Selling Price, Net of Closing Costs & GAAP
Adjustments
Including Closing & Soft Costs
Excess
Purchase
Total
(Deficiency)
Cash
Money
Adjustments
Acquisition
Of Property
Received
Mortgage
Resulting
Costs, Capital
Gain (loss)
Operating
Net
Mortgage
Taken
from
Original
Improvements
on
Cash Receipts
Date
Date of
of Closing
Balance at
Back By
Application
Mortgage
Closing &
sale of
Over Cash
Acquired
Sale(1)
Costs(2)
Time of Sale
Program(3)
Of GAAP
Total(26)
Financing
Soft Costs(4)
Total
Investment
Expenditures
Jan-03
Mar-04
$
2,452,000
$
4,876,000
$
8,700,000
N/A
$
16,028,000
$
5,000,000
$
10,259,000
$
15,259,000
$
769,000
N/A
Feb-04
Sep-04
$
794,000
$
$
528,000
N/A
$
1,322,000
$
$
468,000
$
468,000
$
854,000
N/A
Sep-02
Dec-04
$
1,619,000
$
1,817,000
N/A
N/A
$
3,436,000
$
1,913,000
$
670,000
$
2,583,000
$
853,000
N/A
Jan-02
Apr-05
$
603,000
$
472,000
N/A
N/A
$
1,075,000
$
514,000
$
370,000
$
884,000
$
191,000
N/A
Mar-02
Jul-05
$
13,379,000
$
11,015,000
N/A
N/A
$
24,394,000
$
11,586,000
$
6,836,000
$
18,422,000
$
5,972,000
(25)
N/A
Jun-04
Nov-05
$
1,390,000
$
1,850,000
N/A
N/A
$
3,240,000
$
1,850,000
$
807,000
$
2,657,000
$
583,000
(25)
N/A
Mar-02
Dec-05
$
1,645,000
$
N/A
N/A
$
1,645,000
$
3,534,000
$
(2,376,000
)
$
1,158,000
$
487,000
(25)
N/A
Sep-01
Jan-06
$
2,310,000
$
1,778,000
N/A
N/A
$
4,088,000
$
1,080,000
$
1,728,000
$
2,808,000
$
1,280,000
(25)
N/A
Apr-04
Jan-06
$
917,000
$
863,000
N/A
N/A
$
1,780,000
$
392,000
$
808,000
$
1,200,000
$
580,000
(25)
N/A
Aug-02
Jan-06
$
2,765,000
$
4,209,000
N/A
N/A
$
6,974,000
$
$
6,518,000
$
6,518,000
$
456,000
(25)
N/A
Jan-04
Jun-06
$
12,167,000
$
11,229,000
N/A
N/A
$
23,396,000
$
11,250,000
$
2,260,000
$
13,510,000
$
9,886,000
(25)
N/A
Apr-02
Jul-06
$
3,725,000
$
2,862,000
N/A
N/A
$
6,587,000
$
2,910,000
$
1,279,000
$
4,189,000
$
2,398,000
(25)
N/A
B-13
Table of Contents
Cost of Properties
Selling Price, Net of Closing Costs & GAAP
Adjustments
Including Closing & Soft Costs
Excess
Purchase
Total
(Deficiency)
Cash
Money
Adjustments
Acquisition
Of Property
Received
Mortgage
Resulting
Costs, Capital
Gain (loss)
Operating
Net
Mortgage
Taken
from
Original
Improvements
on
Cash Receipts
Date
Date of
of Closing
Balance at
Back By
Application
Mortgage
Closing &
sale of
Over Cash
Acquired
Sale(1)
Costs(2)
Time of Sale
Program(3)
Of GAAP
Total(26)
Financing
Soft Costs(4)
Total
Investment
Expenditures
Jun-04
Aug-05
$
52,218,000
$
63,640,000
N/A
N/A
$
115,858,000
$
69,943,000
$
35,365,000
$
105,308,000
$
10,550,000
N/A
Mar-03
Dec-05
$
273,000
$
376,000
N/A
N/A
$
649,000
$
399,000
$
118,000
$
517,000
$
132,000
N/A
Jun-04
Jul-06
$
91,730,000
$
N/A
N/A
$
91,730,000
$
56,057,000
$
11,638,000
$
67,695,000
$
24,035,000
(25)
N/A
Apr-04
Sep-06
$
68,261,000
$
51,719,000
N/A
N/A
$
119,980,000
$
62,750,000
$
27,274,000
$
90,024,000
$
29,956,000
(25)
N/A
Jan-04
Sep-06
$
27,584,000
$
18,050,000
N/A
N/A
$
45,634,000
$
14,250,000
$
20,455,000
$
34,705,000
$
10,929,000
(25)
N/A
Apr-04
Oct-06
$
9,639,000
$
15,543,000
N/A
N/A
$
25,182,000
$
15,830,000
$
7,327,000
$
23,157,000
$
2,025,000
(25)
N/A
Dec-03
Oct-06
$
33,707,000
$
40,000,000
N/A
N/A
$
73,707,000
$
25,029,000
$
28,139,000
$
53,168,000
$
20,539,000
(25)
N/A
Sep-02
Nov-06
$
(862,000
)
$
9,588,000
N/A
N/A
$
8,726,000
$
6,700,000
$
2,026,000
$
8,726,000
$
(25)
N/A
Apr-03
Nov-06
$
2,898,000
$
8,881,000
N/A
N/A
$
11,779,000
$
7,605,000
$
3,004,000
$
10,609,000
$
1,170,000
(25)
N/A
Feb-04
Nov-06
$
13,933,000
$
24,520,000
N/A
N/A
$
38,453,000
$
25,000,000
$
12,171,000
$
37,171,000
$
1,282,000
(25)
N/A
Jan-03
Dec-06
$
(219,000
)
$
3,448,000
N/A
N/A
$
3,229,000
$
2,200,000
$
2,171,000
$
4,371,000
$
(1,142,000
)(25)
N/A
May-03
Dec-06
$
5,633,000
$
10,089,000
N/A
N/A
$
15,722,000
$
9,815,000
$
3,178,000
$
12,993,000
$
2,729,000
(25)
N/A
B-14
Table of Contents
Cost of Properties
Selling Price, Net of Closing Costs & GAAP
Adjustments
Including Closing & Soft Costs
Excess
Purchase
Total
(Deficiency)
Cash
Money
Adjustments
Acquisition
Of Property
Received
Mortgage
Resulting
Costs, Capital
Gain (loss)
Operating
Net
Mortgage
Taken
from
Original
Improvements
on
Cash Receipts
Date
Date of
of Closing
Balance at
Back By
Application
Mortgage
Closing &
sale of
Over Cash
Acquired
Sale(1)
Costs(2)
Time of Sale
Program(3)
Of GAAP
Total(26)
Financing
Soft Costs(4)
Total
Investment
Expenditures
Sep-02
Mar-05
$
11,768,000
$
9,053,000
N/A
N/A
$
20,821,000
$
14,200,000
$
(53,000
)
$
14,147,000
$
6,674,000
N/A
Jun-03
Sep-05
$
15,249,000
$
17,014,000
N/A
N/A
$
32,263,000
$
15,750,000
$
8,298,000
$
24,048,000
$
8,215,000
(25)
N/A
Nov-04
Feb-05
$
7,727,000
$
11,000,000
N/A
N/A
$
18,727,000
$
11,000,000
$
7,342,000
$
18,342,000
$
385,000
N/A
Oct-04
Apr-05
$
2,327,000
$
4,110,000
$
2,300,000
N/A
$
8,737,000
$
4,125,000
$
1,597,000
$
5,722,000
$
3,015,000
N/A
Mar-04
Aug-05
$
7,244,000
$
7,570,000
N/A
N/A
$
14,814,000
$
7,567,000
$
5,168,000
$
12,735,000
$
2,079,000
N/A
Jun-04
Nov-05
$
2,405,000
$
3,151,000
N/A
N/A
$
5,556,000
$
3,151,000
$
1,417,000
$
4,568,000
$
988,000
N/A
Oct-04
Dec-05
$
7,493,000
$
N/A
N/A
$
7,493,000
$
$
5,091,000
$
5,091,000
$
2,402,000
N/A
Apr-04
Jan-06
$
7,052,000
$
6,639,000
N/A
N/A
$
13,691,000
$
3,016,000
$
5,132,000
$
8,148,000
$
5,543,000
N/A
Dec-05
Oct-06
$
21,726,000
$
46,530,000
N/A
N/A
$
68,256,000
$
57,737,000
$
9,346,000
$
67,083,000
$
1,173,000
N/A
(1)
No sales were to affiliated parties except as noted below.
(2)
Net cash received plus assumption of certain liabilities by
buyer.
(3)
The amounts shown are the face amounts and do not represent
discounted current value.
(4)
Does not include pro-rata share of original offering costs.
Amount shown is net of depreciation for consolidated properties
and net of previous distributions received for unconsolidated
properties.
(5)
In connection with the sale, Triple Net received a note
receivable which was secured by a pledge agreement, bore
interest at 6% per annum and matured on June 14, 2004.
The note was refinanced by the buyer and Triple Net received
$6,500,000 on July 9, 2004 and issued an adjustable note
receivable for $2,200,000. The new note bears interest at
8.6% per annum and was due on August 1, 2006. The note
was paid in full on May 5, 2006.
(6)
In connection with the sale, Triple Net received a note
receivable which was secured by a pledge agreement, bore
interest at 4% per annum and was due on March 7, 2005.
The note was paid in full on March 7, 2005.
(7)
Represents results only for T REITs 25% TIC interest.
(8)
Represents results only for T REITs 16% interest.
(9)
Represents results only for T REITs 89.1% interest.
(10)
Represents results only for T REITs 2.7% interest.
(11)
Represents results only for T REITs 22.8% interest. Date
of Sale is the date of sale of the last building in the
property. Cash received is our final distribution on the
investment and mortgage at the time of sale is the mortgage
balance as of the date of the sale of the last building. Note
that the balance was paid off in connection with the sale of one
of the earlier buildings.
B-15
Table of Contents
(12)
Represents results only for T REITs 40% TIC interest.
(13)
Represents results only for T REITs 9.8% interest.
(14)
Represents results only for T REITs 75% TIC interest.
(15)
Represents results only for T REITs 48.5% TIC interest.
(16)
Represents results only for G REITs 4.75% interest.
(17)
The mortgage associated with 600 B Street (Comerica) was paid
off in connection with a prior property sale.
(18)
This property was sold to an affiliated party. Represents
results for NNN 2002 Value Fund, LLCs 50% interest.
(19)
This property was sold to an affiliated party.
(20)
In connection with the sale, Triple Net received a note
receivable secured by the property, bears interest at a fixed
rate of 8.0% per annum and matures on April 1, 2008.
The note requires monthly interest-only payments.
(21)
Represents results only for NNN 2003 Value Fund, LLCs
18.3% interest.
(22)
Represents results only for NNN 2003 Value Fund, LLCs 4.6%
interest.
(23)
Represents results only for NNN 2003 Value Fund, LLCs
75.4% interest.
(24)
Date of sale represents the date of sale of NNN 2003 Value Fund,
LLCs last remaining interest in the property. Represents
results only for NNN 2003 Value Fund, LLCs 99% interest.
(25)
Represents the book value gain. Under liquidation accounting,
adopted as of June 30, 2005 for T REIT, Inc.,
August 31, 2005 for NNN 2002 Value Fund, LLC, and
December 31, 2005 for G REIT, Inc. an investment is carried
at its estimated fair value less costs to sell.
(26)
The allocation of the taxable gain between ordinary and capital
is as follows:
Capital Gain/(Loss)
Ordinary Income/(Loss)
Total
$
(22,000
)
$
$
(22,000
)
$
N/A
$
$
$
2,569,000
$
$
2,569,000
$
1,477,000
$
$
1,477,000
$
243,000
$
$
243,000
$
716,000
$
$
716,000
$
259,000
$
(23,000
)
$
236,000
$
10,277,000
$
(912,000
)
$
9,365,000
$
609,000
$
(129,000
)
$
480,000
$
688,000
$
(85,000
)
$
603,000
$
1,422,000
$
(61,000
)
$
1,361,000
$
361,000
$
(37,000
)
$
324,000
$
1,788,000
$
13,000
$
1,801,000
$
6,287,000
$
7,224,000
$
13,511,000
$
3,107,000
$
133,000
$
3,240,000
B-16
Table of Contents
Capital Gain/(Loss)
Ordinary Income/(Loss)
Total
$
11,769,000
$
(615,000
)
$
11,154,000
$
177,000
$
(9,000
)
$
168,000
$
24,098,000
$
2,676,000
$
26,774,000
$
25,977,000
$
1,527,000
$
27,504,000
$
10,260,000
$
1,132,000
$
11,392,000
$
2,194,000
$
664,000
$
2,858,000
$
20,997,000
$
1,731,000
$
22,728,000
$
1,712,000
$
518,000
$
2,230,000
$
1,518,000
$
(368,000
)
$
1,150,000
$
5,422,000
$
329,000
$
5,751,000
$
1,096,000
$
84,000
$
1,180,000
$
2,426,000
$
701,000
$
3,127,000
$
6,363,000
$
(508,000
)
$
5,855,000
$
8,481,000
$
1,069,000
$
9,550,000
$
$
509,000
$
509,000
$
$
2,254,000
$
2,254,000
$
1,972,000
$
48,000
$
2,020,000
$
1,029,000
$
(218,000
)
$
811,000
$
N/A
$
(4,000
)
$
(4,000
)
$
2,788,000
$
(289,000
)
$
2,499,000
$
1,523,000
$
501,000
$
2,024,000
No gain was recognized for tax purposes on the sale of Thousand
Oaks and Southwood Tower as the net proceeds from the sale were
reinvested in a like-kind exchange under Section 1031 of
the Internal Revenue Code.
B-17
Table of Contents
B-18
Table of Contents
Less
Total Private
1
90
Subtotal of
8 Affiliated
Programs Excluding
Opportunity
TIC
91 Private
Program
Affiliated
Fund VIII, LLC
Programs
Programs
Ownerships
Ownerships
$
20,000,000
$1,267,737,250
$1,287,737,250
$
27,992,271
$
1,259,744,979
$
11,805,559
$1,267,617,378
$1,279,422,937
$
27,992,271
$
1,251,430,666
59.0%
100.0%
99.4%
100.0%
99.3%
7.0%
7.0%
7.0%
7.8%
7.0%
3.5%
3.1%
3.1%
2.5%
3.1%
2.5%
2.8%
2.8%
3.6%
2.8%
8.0%
5.6%
5.6%
10.4%
5.6%
79.0%
81.5%
81.5%
75.7%
81.5%
74.5%
78.3%
78.3%
73.0%
78.3%
2.5%
2.9%
2.9%
1.7%
2.9%
2.0%
0.3%
0.3%
1.0%
0.3%
79.0%
81.5%
81.5%
75.7%
81.5%
82%
70%
70%
13-Dec-04
July 18, 2003 to
October 31, 2006
16-Jun-06
January 20, 2004 to
December 21, 2006
17 months
2 to 17 months
n/a
1 to 12 months
336
1,841
2,177
7
2,170
2,226
2,226
1
2,225
336
4,067
4,403
8
4,395
(1)
Includes legal, accounting, printing and other offering
expenses, including amounts for the reimbursement for marketing,
salaries and direct expenses of employees engaged in marketing
and other organization expenses.
B-19
Table of Contents
B-20
Table of Contents
14 Affiliated
Excluding
91 Private
65 Other
156 Private
Program
Affiliated
Programs
Programs
Programs
Ownerships
Ownerships
July 18, 2003 to
July 1, 1998 to
October 31, 2006
December 5, 2006
$
1,277,315,922
$
450,796,920
$
1,728,112,842
$
61,634,586
$
1,666,478,256
$
89,633,759
$
7,359,732
$
96,993,491
$
2,138,691
$
94,854,800
40,205,319
3,432,879
43,638,198
680,814
42,957,384
35,109,983
2,531,591
37,641,574
983,587
36,657,987
11,502,553
377,438
11,879,991
52,205
11,827,786
394,800
394,800
394,800
$
176,846,414
$
13,701,640
$
190,548,054
$
3,855,297
$
186,692,757
$
71,990,359
$
2,119,500
$
74,109,859
$
2,053,711
$
72,056,148
$
197,397,511
$
78,737,017
$
276,134,528
$
15,294,292
$
260,840,235
2,854,066
6,612,706
9,466,772
1,057,290
8,409,482
58,549
954,351
1,012,900
1,012,900
407,010
2,456,282
2,863,292
336,915
2,526,377
$
3,319,625
$
10,023,339
$
13,342,964
$
1,394,205
$
11,948,759
6,359,036
4,116,953
10,475,989
1,125,630
9,350,359
31,103
990,656
1,021,758
1,021,758
159,107
523,885
682,993
29,051
653,942
$
6,549,246
$
5,631,494
$
12,180,740
$
1,154,681
$
11,026,059
15,282,297
3,827,945
19,110,242
611,229
18,499,013
8,629,019
2,278,024
10,907,043
238,113
10,668,930
$
23,911,316
$
6,105,969
$
30,017,285
$
849,342
$
29,167,943
$
9,021,716
$
11,934,000
$
20,955,716
$
1,768,513
$
19,187,204
242,853
3,183,281
3,426,134
181,499
3,244,635
400,698
337,838
738,536
110,122
628,414
340,480
325,281
665,761
81,900
583,860
$
10,005,747
$
15,780,400
$
25,786,147
$
2,142,034
$
23,644,113
B-21
Table of Contents
2006
2005
2004
2003
2002
2001
122 TIC
100 TIC
60 TIC
36 TIC
18 TIC
2 TIC
Programs
Programs
Programs
Programs
Programs
Programs
$
353,999,775
$
235,233,264
$
142,333,748
$
56,337,980
$
10,884,051
$
311,615
50,355,892
43,545,180
3,365,199
430,126
384,010
132,962,673
90,121,252
48,978,673
19,298,613
2,478,639
60,597
9,143,262
4,321,152
2,034,752
825,416
171,242
667
129,424,655
72,621,838
35,325,336
14,787,045
3,698,852
93,874
$
132,825,077
$
111,714,202
$
59,360,186
$
21,857,032
$
4,919,328
$
156,477
$
86,703,984
$
69,922,878
$
55,299,433
$
21,468,277
$
4,607,180
$
156,477
128,888,158
149,023,359
11,384,836
883,148
312,300
2,929,222
7,616,687
819,282
218,521,364
226,562,924
67,503,551
22,351,425
4,919,480
156,477
6,014,879
7,372,155
5,389,993
1,820,447
384,765
16,726
212,506,485
219,190,768
62,113,558
20,530,978
4,534,715
139,751
73,814,263
53,006,015
31,274,654
11,476,777
2,347,002
22,395
132,019,854
141,672,518
12,142,157
771,955
3,831,095
338,295
501,251
117,219
2,841,273
24,173,941
18,195,496
8,165,027
2,187,713
117,356
$
2,841,273
$
24,173,941
$
18,195,496
$
8,165,027
$
2,187,713
$
117,356
$
$
$
$
$
$
2.78
0.34
0.84
0.42
95.81
143.98
20.42
2.78
$
53.57
$
53.87
$
52.60
$
41.40
$
30.13
$
3.31
Note A:
For the TIC programs, individual investors are involved in
a tax deferred exchange. Each TIC has an individual tax bases
for depreciation and amortization and is responsible for their
own calculations of depreciation and amortization.
Note B:
Approximately $3,480,000 in 2006 is due to the following:
utilization of equity funded reserves for designated repairs in
apartment programs ($1,900,000); utilization of equity funded
reserves for payment of mezzanine interest ($380,000);
acceleration of payments for interest expense and property taxes
for income tax purposes ($450,000); unbilled CAM and rents at
December 31, 2006 ($630,000); and unanticipated expenses
due to hurricane damage at two properties ($120,000).
B-22
Table of Contents
2006
2005
2004
2003
2002
2001
13 Affiliated
14 Affiliated
14 Affiliated
6 Affiliated
2 Affiliated
1 Affiliated
Programs
Programs
Programs
Programs
Programs
Program
$
6,916,777
$
11,244,143
$
18,500,226
$
6,352,154
$
594,889
$
22,090
7,149,318
3,113,871
158,777
145,659
4,206,048
5,592,738
6,699,094
2,815,081
233,660
4,264
187,856
181,192
154,620
81,474
12,452
2,093,425
2,743,523
3,662,498
1,244,057
196,158
7,528
$
7,578,766
$
5,840,561
$
7,984,014
$
2,370,319
$
298,278
$
10,298
$
852,077
$
2,784,768
$
7,669,401
$
2,227,233
$
179,878
$
10,298
20,674,751
12,910,464
334,987
118,459
(10,403
)
287,066
21,526,828
15,684,829
7,956,467
2,562,220
298,337
10,298
113,815
144,097
105,701
34,142
10,842
1,709
21,413,013
15,540,732
7,850,766
2,528,078
287,495
8,589
1,287,582
2,785,059
3,965,091
1,229,694
133,559
22,627,577
11,054,797
259,288
292,767
20,997
(2,502,146
)
1,700,876
3,605,390
1,005,617
153,936
8,589
$
(2,502,146
)
$
1,700,876
$
3,605,390
$
1,005,617
$
153,936
$
8,589
$
$
$
$
$
$
0.34
621.11
182.07
4.17
8.93
$
35.34
$
45.87
$
63.81
$
37.50
$
49.47
$
Note A:
For the TIC programs, individual investors are involved in
a tax deferred exchange. Each TIC has an individual tax bases
for depreciation and amortization and is responsible for their
own calculations of depreciation and amortization.
B-23
Table of Contents
2006
2005
2004
2003
2002
2001
122
100
60
36
18
2
TIC Programs
TIC Programs
TIC Programs
TIC Programs
TIC Programs
TIC Programs
$
347,082,998
$
223,989,121
$
123,833,522
$
49,985,826
$
10,289,162
$
289,525
43,206,574
40,431,309
3,365,199
271,349
238,351
128,756,625
84,528,514
42,279,579
16,483,532
2,244,979
56,333
8,955,406
4,139,960
1,880,132
743,942
158,790
667
127,331,230
69,878,315
31,662,838
13,542,988
3,502,694
86,346
$
125,246,311
$
105,873,641
$
51,376,172
$
19,486,713
$
4,621,050
$
146,179
$
85,851,907
$
67,138,110
$
47,630,032
$
19,241,044
$
4,427,302
$
146,179
108,213,407
136,112,895
11,384,836
548,161
193,841
2,929,222
7,627,089
532,216
196,994,536
210,878,094
59,547,084
19,789,205
4,621,143
146,179
5,901,064
7,228,058
5,284,292
1,786,305
373,923
15,017
191,093,472
203,650,036
54,262,792
18,002,900
4,247,220
131,162
72,526,681
50,220,956
27,309,563
10,247,083
2,213,443
22,395
109,392,277
130,617,721
11,882,869
479,188
3,831,095
338,295
480,254
117,219
5,343,419
22,473,064
14,590,106
7,159,410
2,033,777
108,767
$
5,343,419
$
22,473,064
$
14,590,106
$
7,159,410
$
2,033,777
$
108,767
$
$
$
$
$
$
2.86
0.37
0.90
0.48
81.54
141.47
22.32
1.96
$
54.06
$
54.39
$
51.29
$
41.93
$
29.44
$
3.57
Note A:
For the TIC programs, individual investors are involved in
a tax deferred exchange. Each TIC has an individual tax bases
for depreciation and amortization and is responsible for their
own calculations of depreciation and amortization.
Note B:
Approximately $3,480,000 in 2006 is due to the following:
utilization of equity funded reserves for designated repairs in
apartment programs ($1,900,000); utilization of equity funded
reserves for payment of mezzanine interest ($380,000);
acceleration of payments for interest expense and property taxes
for income tax purposes ($450,000); unbilled CAM and rents at
December 31, 2006 ($630,000); and unanticipated expenses
due to hurricane damage at two properties ($120,000).
B-24
Table of Contents
2006
2005
2004
2003
2002
2001
$
2,522,318
$
631,180
$
2,034,929
$
1,903,524
$
2,154,090
$
131,060
847,861
2,030,172
181,367
148,478
924,806
401,885
980,612
885,929
999,943
62,336
81,553
163,504
94,807
138,261
127,893
1,576,853
240,744
558,522
494,086
793,565
68,223
351,244
636,822
423,758
473,500
35,452
$
786,967
$
1,503,975
$
(235,834
)
$
142,857
$
(92,333
)
$
(34,951
)
$
(60,894
)
$
(526,197
)
$
(235,834
)
$
(38,510
)
$
(240,811
)
$
(34,951
)
847,861
2,030,172
181,367
148,478
(60,894
)
(174,953
)
648,863
412,827
280,598
501
847,861
7,102,052
588,766
208,200
(88,806
)
786,967
6,927,099
560,057
1,001,593
488,798
501
52,148
77,695
66,812
62,020
786,967
6,874,951
482,362
934,781
426,778
501
647,681
180,696
218,578
501
1,898,534
2,623,375
588,766
208,200
121,775
130,342
17,848
(1,111,567
)
4,251,576
(287,094
)
165,319
(130,342
)
(17,848
)
$
(1,111,567
)
$
4,251,576
$
(287,094
)
$
165,319
$
(130,342
)
$
(17,848
)
$
(2.67
)
$
(47.87
)
$
(21.45
)
$
(3.50
)
$
(21.91
)
$
(13.66
)
37.19
184.69
16.50
13.51
11.08
11.86
6.98
83.28
238.66
53.56
18.94
$
$
$
58.92
$
16.44
$
19.88
$
0.20
B-25
Table of Contents
2006
2005
2004
2003
closed
one
one
one
Notes Program
Notes Program
Notes Program
Notes Program
$
$
$
70,032
$
413
22,751
7,823
82
43,514
104,488
19,227
$
$
(66,265
)
$
(42,279
)
$
(18,896
)
$
$
(66,265
)
$
(42,279
)
$
(18,896
)
(66,265
)
(42,279
)
(18,896
)
(66,265
)
(42,279
)
(18,896
)
(66,265
)
(42,279
)
(18,896
)
$
$
(66,265
)
$
(42,279
)
$
(18,896
)
$
$
11.00
$
11.00
$
11.00
$
$
$
$
B-26
Table of Contents
NNN
NNN
NNN
2000
NNN Town
NNN
NNN
NNN
Yerington
Tech
NNN
County
Tellride
Kiwi
Value
&
Bryant
Saddleback
Fund
Shopping
Fund
Alamosa
Center
Barstow,
Assoc,
Fund,
Country,
Ranch,
Financial,
VIII,
Center,
III,
Plaza,
Drive,
LLC
LLC
LLC
LLC
LLC
LLC
LLC
LLC
LLC
LLC
LLC
$
1,619,550
$
2,681,352
$
4,816,000
$
7,200,000
$
5,000,000
$
3,865,800
$
8,000,000
$
1,625,000
$
3,698,750
$
6,650,000
$
3,125,000
1
1
7
1
1
1
3
1
3
1
1
16-Dec-98
4-Feb-01
27-Feb-01
29-Mar-00
12-Nov-02
29-Oct-02
7-Mar-00
3-Aug-99
20-Jun-00
25-Oct-02
6-Feb-02
19-Feb-03
25-Feb-03
26-Oct-01
25-Jun-04
2-Nov-04
27-Dec-04
26-Mar-02
17-Jan-05
3-Jul-01
24-Mar-05
14-Apr-05
19-Feb-03
25-Feb-03
15-Oct-02
25-Jun-04
2-Nov-04
27-Dec-04
6-Jan-04
17-Jan-05
7-Feb-05
24-Mar-05
14-Apr-05
26.58
34.78
71.23
11.83
125.22
54.24
13.82
884.53
1,053.34
880.51
1,221.31
1,206.17
1,384.96
1,305.19
1,132.76
1,293.88
1,266.59
1,206.37
195.48
68.33
$
401.16
$
175.12
$
155.63
268.98
184.74
181.08
129.11
496.14
446.45
210.94
247.48
Note: A
There are three notes programs that have completed operations
and are closed. The notes programs report interest income to the
note unit holders. The remaining programs included in this table
are TIC programs with investors generally involved in tax
deferred exchanges. Accordingly, each TIC has an individual tax
basis for determining amortization and depreciation. Neither
type of program requires depreciation or amortization,
therefore, there is no presentation of Federal Income Tax
Results.
(1)
The investors received a note from buyer as distributed proceeds
from the sale.
B-27
Table of Contents
(1)
NNN
NNN
Truckee
NNN
City
LV
NNN
River
NNN
Rocky
NNN
Center
1900
NNN
801
NNN
Office
North
Mountain
Jefferson
West
Aerojet
Park
K
NNN
Springtown
Tower,
Reno
Exchange,
Square,
A,
Way
Sahara,
Street,
Timberhills,
Mall,
LLC
LLC
LLC
LLC
LLC
LLC
LLC
LLC
LLC
LLC
$
5,550,000
$
2,750,000
$
2,670,000
$
9,200,000
$
1,237,803
$
2,000,000
$
4,953,000
$
29,600,000
$
3,695,375
$
2,550,000
1
1
1
2
1
1
5
1
1
1
15-Jul-99
19-Jun-02
15-Feb-01
26-Aug-03
15-Mar-02
31-Aug-01
17-Mar-03
31-Mar-04
27-Nov-01
21-Mar-03
15-Apr-05
19-May-05
31-May-05
22-Jul-05
28-Jul-05
27-Sep-05
20-Dec-05
26-Aug-05
19-Oct-05
2-Nov-05
15-Apr-05
19-May-05
31-May-05
22-Jul-05
28-Jul-05
27-Sep-05
20-Dec-05
26-Aug-05
19-Oct-05
2-Nov-05
24.79
13.68
35.18
953.00
1,758.24
829.87
1,308.76
1,300.67
1,123.45
1,102.58
1,124.72
1,387.80
1,206.35
619.55
323.12
187.30
189.41
262.83
319.50
128.07
113.57
305.43
439.16
B-28
Table of Contents
NNN
NNN
NNN
NNN
NNN
NNN
Titan
NNN
NNN
Exchange
1851
NNN
Oakey
City
Amber
Building
Emerald
Kahana
Fund
NNN
E 1st
Reno
Building
Center
Oaks
and
Plaza,
Gateway,
III,
PCP 1,
Street,
Trademark,
2003,
West B,
III,
Plaza,
LLC
LLC
LLC
LLC
LLC
LLC
LLC
LLC
LLC
LLC
$
42,800,000
$
8,140,000
$
6,300,000
$
5,800,000
$
20,500,000
$
3,850,000
$
8,270,000
$
8,200,000
$
10,070,000
$
2,219,808
1
3
1
6
1
1
1
1
1
1
5-Jan-05
6-Mar-03
31-May-00
25-Jun-02
29-Jul-03
29-Sep-01
19-May-04
15-Jun-02
20-Jan-04
28-May-02
10-Nov-05
15-Nov-05
9-Dec-05
10-Oct-02
9-Jan-06
23-Jan-06
24-Jan-06
17-Apr-06
15-Jun-06
21-Jul-06
10-Nov-05
15-Nov-05
9-Dec-05
29-Dec-05
9-Jan-06
23-Jan-06
24-Jan-06
17-Apr-06
15-Jun-06
21-Jul-06
14.36
1,203.34
1,638.63
427.98
1,016.63
1,262.45
1,256.62
1,343.87
1,882.87
1,622.67
1,582.58
283.64
92.28
252.29
231.59
283.85
238.01
361.45
136.48
306.07
190.19
589.44
B-29
Table of Contents
NNN
NNN
NNN
NNN
NNN
901
NNN
2004
2005
2006
Las Cimas
Corporate
Sacramento
Notes
Notes
Notes
II and III,
Center,
Corporate,
Program,
Program,
Program,
Program
LLC
LLC
LLC
LLC
LLC
LLC
Totals
$
32,250,000
$
6,292,125
$
12,000,000
$
5,000,000
$
1,044,881
$
285,224,444
2
1
1
N/A
N/A
N/A
57
9-Dec-04
3-Oct-03
21-May-01
14-Aug-01
14-Aug-01
22-May-03
7-Aug-06
22-Aug-06
17-Nov-06
N/A
N/A
N/A
7-Aug-06
22-Aug-06
17-Nov-06
N/A
N/A
N/A
66.00
33.00
30.00
10.89
1,328.68
1,190.72
1,396.11
199.70
172.94
405.69
B-30
Table of Contents
Cost of Properties
Including Closing & Soft Costs
(3)
Selling Price,
Total
(4)
Net of Closing Costs & GAAP Adjustments
Acquisition
(Deficiency)
(2)
Adjustments
Costs,
of Property
Cash
Purchase
Resulting
Capital
Operating
Received
Mortgage
Mortgage
from
(3)
Improvements
Cash
Date
Net of
Balance
Taken
Application
Original
Closing &
Gain on
Receipts
(1)
Date
of
Closing
at Time
Back by
of
Mortgage
Soft
Sale of
Over Cash
Acquired
Sale
Costs
of Sale
Program
GAAP
Total
Financing
Costs
Total
Investment
Expenditures
Center, Pueblo, CO
Jun-99
Jan-04
$
1,291,445
$
2,737,342
N/A
N/A
$
4,028,787
$
2,840,000
$
980,428
$
3,820,428
$
208,359
$
84,960
Center, Lancaster, CA
Nov-98
Feb-04
$
3,434,518
$
6,557,693
N/A
N/A
$
9,992,211
$
6,937,000
$
2,029,944
$
8,966,944
$
1,025,267
N/A
Shopping Center,
Sacramento, CA
Jul-99
Jun-04
$
8,848,316
$
33,420,982
N/A
N/A
$
42,269,298
$
34,000,000
$
6,472,676
$
40,472,676
$
1,796,622
$
845,694
Sep-02
Nov-04
$
6,030,873
$
5,910,623
N/A
N/A
$
11,941,496
$
6,222,000
$
4,295,532
$
10,517,532
$
1,423,964
$
441,907
Sep-02
Dec-04
$
7,138,617
$
7,269,300
N/A
N/A
$
14,407,917
$
7,650,000
$
4,169,605
$
11,819,605
$
2,588,312
$
260,813
Center, Yerington, NV
Mar-99
Jan-05
$
1,924,607
$
3,114,225
N/A
N/A
$
5,038,832
$
3,316,200
$
1,261,108
$
4,577,308
$
461,524
$
(31,961
)
Moreno Valley, CA
Jun-00
Feb-05
$
6,687,677
$
8,246,910
N/A
N/A
$
14,934,587
$
9,200,000
$
3,420,584
$
12,620,584
$
2,314,003
$
(503,493
)
Center, Las Vegas, NV
Oct-02
Mar-05
$
8,538,537
$
13,134,859
N/A
N/A
$
21,673,396
$
13,500,000
$
5,213,556
$
18,713,556
$
2,959,840
$
(429
)
Temecula, CA(6)
Sep-01
Apr-05
$
3,614,632
$
2,951,930
N/A
N/A
$
6,566,562
$
3,210,000
$
2,247,787
$
5,457,787
$
1,108,775
$
179,605
Dec-98
Apr-05
$
4,902,752
$
12,000,000
N/A
N/A
$
16,902,752
$
12,000,000
$
6,434,344
$
18,434,344
$
(1,531,592
)
$
1,951,679
Jun-02
May-05
$
4,750,826
$
5,261,170
N/A
N/A
$
10,011,996
$
5,400,000
$
1,898,590
$
7,298,590
$
2,713,406
$
(116,347
)
Nov-00
May-05
$
$
5,275,000
$
2,105,747
N/A
$
7,380,747
$
5,275,000
$
2,541,815
$
7,816,815
$
(436,068
)
$
424,757
Jul-03
Jul-05
$
12,050,824
$
12,834,953
N/A
N/A
$
24,885,777
$
13,070,000
$
7,583,949
$
20,653,949
$
4,231,828
$
497,636
Mar-02
Jul-05
$
15,982,448
$
12,358,953
N/A
N/A
$
28,341,401
$
13,000,000
$
9,712,906
$
22,712,906
$
5,628,495
$
631,797
Mar-04
Aug-05
$
34,092,300
$
41,350,000
N/A
N/A
$
75,442,300
$
41,350,000
$
26,332,745
$
67,682,745
$
7,759,555
$
450,684
Aug-01
Sep-05
$
2,254,788
$
3,490,513
N/A
N/A
$
5,745,301
$
3,625,000
$
1,740,006
$
5,365,006
$
380,295
$
157,107
Sep-01
Sep-05
$
3,128,166
$
2,669,550
N/A
N/A
$
5,797,716
$
2,938,000
$
2,370,647
$
5,308,647
$
489,069
N/A
Nov-01
Oct-05
$
4,916,439
$
6,163,260
N/A
N/A
$
11,079,699
$
6,390,000
$
3,122,242
$
9,512,242
$
1,567,457
$
453,420
B-31
Table of Contents
Cost of Properties
Including Closing & Soft Costs
(3)
(4)
Selling Price,
Total
(Deficiency)
Net of Closing Costs & GAAP Adjustments
Acquisition
of
(2)
Adjustments
Costs,
Property
Cash
Purchase
Resulting
Capital
Operating
Received
Mortgage
Mortgage
from
(3)
Improvements
Cash
Date
Net of
Balance
Taken
Application
Original
Closing &
Gain on
Receipts
(1)
Date
of
Closing
at Time
Back by
of
Mortgage
Soft
Sale of
Over Cash
Acquired
Sale
Costs
of Sale
Program
GAAP
Total
Financing
Costs
Total
Investment
Expenditures
Center, San Marcos, TX
Dec-02
Nov-05
$
2,874,263
$
4,541,495
N/A
N/A
$
7,415,758
$
4,700,000
$
1,940,473
$
6,640,473
$
775,285
$
(184,060
)
Jun-04
Nov-05
$
50,123,011
$
68,500,000
N/A
N/A
$
118,623,011
$
68,500,000
$
33,925,438
$
102,425,438
$
16,197,573
$
(1,099,959
)
Center and Professional Building, Maui, HI
Dec-02
Nov-05
$
11,165,104
$
12,642,394
N/A
N/A
$
23,807,498
$
13,041,000
$
6,732,222
$
19,773,222
$
4,034,276
$
602,436
Dec-99
Dec-05
$
2,977,973
$
11,488,641
N/A
N/A
$
14,466,614
$
11,835,000
$
5,642,906
$
17,477,906
$
(3,011,292
)
$
648,998
Mar-03
Dec-05
$
6,548,932
$
7,911,654
N/A
N/A
$
14,460,586
$
8,400,000
$
4,326,695
$
12,726,695
$
1,733,891
$
(260,846
)
Mar-02
Dec-05
$
12,655,065
$
15,500,000
N/A
N/A
$
28,155,065
$
15,500,000
$
9,816,378
$
25,316,378
$
2,838,687
$
(604,058
)
Jun-03
Jan-06
$
24,141,399
$
49,000,000
N/A
N/A
$
73,141,399
$
45,375,000
$
18,587,746
$
63,962,746
$
9,178,653
$
(977,472
)
NV(15)
Sep-01
Jan-06
$
5,742,885
$
4,444,615
N/A
N/A
$
10,187,500
$
2,700,000
$
4,919,977
$
7,619,977
$
2,567,523
$
78,045
Apr-04
Jan-06
$
7,428,067
$
10,650,000
N/A
N/A
$
18,078,067
$
4,000,000
$
11,441,254
$
15,441,254
$
2,636,813
$
1,626,067
Las Vegas, NV
Jan-02
Apr-06
$
18,318,726
$
14,115,548
N/A
N/A
$
32,434,274
$
14,650,000
$
7,515,962
$
22,165,962
$
10,268,312
$
(3,257,037
)
TX(17)
Jan-04
Jun-06
$
16,252,892
$
15,000,000
N/A
N/A
$
31,252,892
$
15,000,000
$
9,736,741
$
24,736,741
$
6,516,151
$
1,412,415
Apr-02
Jul-06
$
6,521,705
$
6,900,000
N/A
N/A
$
13,421,705
$
6,000,000
$
4,130,277
$
10,130,277
$
3,291,428
$
1,564,882
Sep-04
Aug-06
$
44,214,822
$
45,217,600
N/A
N/A
$
89,432,422
$
46,800,000
$
27,046,337
$
73,846,337
$
15,586,085
$
(568,942
)
Monterey Park, CA
Aug-03
Aug-06
$
8,602,046
$
10,905,994
N/A
N/A
$
19,508,040
$
11,310,000
$
5,361,786
$
16,671,786
$
2,836,254
$
(917,688
)
Mar-01
Nov-06
$
22,734,929
$
21,213,069
N/A
N/A
$
43,947,998
$
22,250,000
$
14,333,839
$
36,583,839
$
7,364,159
$
(255,104
)
Dec-02
Dec-06
$
10,197,512
$
14,531,163
N/A
N/A
$
24,728,675
$
13,922,000
$
8,534,931
$
22,456,931
$
2,271,744
$
3,217,904
(1)
No sales were to affiliated parties except as noted below.
(2)
Net cash received plus assumption of certain liabilities by
buyer.
(3)
Does not include pro-rata share of original offering costs.
(4)
Includes add back of monthly principal reductions during the
operating cycle (see Table III) as total cost includes
balance of Original Mortgage Financing
(5)
A private program owned 75% of the property. TREIT, Inc,
affiliate owned 25% of the property. The above reflects property
level sale results, or 100% of the ownership.
(6)
TREIT Inc, a Triple Net affiliate owned a 16% tenant in common
interest in the NNN County Center Drive, LLC. The private
program owning 100% of the property.
B-32
Table of Contents
(7)
This property was sold to Triple Net Properties.
(8)
A private program owned 10.875% of the property. TREIT, Inc, a
affiliate owned 89.125% of the property. The above reflects
property level sale results, or 100% ownership.
(9)
NNN 2003 Value Fund, LLC, an affiliate owned a 85% membership
interest in NNN 801 K Street, LLC which had a 21.5% tenant in
common interest in the private program owning 100% of the
property.
(10)
NNN 2003 Value Fund, LLC, an affiliate owned a 22.4% membership
interest in NNN Emerald Plaza, LLC which had a 20.5% tenant in
common interest in the private program owning 100% of the
property.
(11)
TREIT, Inc, an affiliate owned a 13.2% membership interest in
NNN Emerald Plaza, LLC which had a 20.5% tenant in common
interest in the private program owning 100% of the property.
(12)
A private program owned 95.25% of the property. GREIT, Inc, a
affiliate owned 4.75% of the property. The above reflects
property level sale results, or 100% ownership.
(13)
NNN 2001 Value Fund, LLC owned 40% of the property. NNN Pacific
Corporate Park I, LLC owned 60% of the property. The above
reflects property level sale results, or 100% ownership.
(14)
TREIT, Inc, an affiliate owned a 37.9% membership interest in
NNN Pacific Corporate Park I, LLC which had a 60% interest
in the property.
(15)
A private program owned 60% of the property. TREIT, Inc, an
affiliate owned 40% of the property. The above reflects property
level sale results, or 100% ownership.
(16)
NNN 2003 Value Fund, LLC and TREIT, Inc, affiliates,
respectively owned a 75.4% and 9.8% membership interests in NNN
Oakey 2003, LLC which owned 100% of the property.
(17)
TREIT, Inc, an affiliate owned a 75% tenant in common interest
in NNN Amber Oaks, LLC. The private program owned 100% of the
property.
(18)
A private program owned 51.5% of the property. TREIT, Inc, an
affiliate owned 48.5% of the property. The above reflects
property level sale results, or 100% ownership.
*
Partial sales of the White Lakes Mall, and Netpark have
occurred; however, a portion of the original acquisitions still
remain in the program. No reporting of these sales will occur
until the entire original acquisition has been disposed of.
B-33
Table of Contents
Table of Contents
C-2
Table of Contents
C-3
Table of Contents
C-4
Table of Contents
C-5
Table of Contents
Table of Contents
D-2
Table of Contents
Table of Contents
Item 31.
Other
Expenses of Issuance and Distribution.
Amount
$
43,000
$
76,000
$
2,000,000
$
2,000,000
$
3,307,000
$
120,000
$
4,468,000
$
140,000
$
346,000
$
5,000,000
$
17,500,000
Item 32.
Sales
to Special Parties.
Item 33.
Recent
Sales of Unregistered Securities.
Item 34.
Indemnification
of Directors and Officers.
II-1
Table of Contents
Item 35.
Treatment
of Proceeds from Securities Being Registered.
Item 36.
Financial
Statements and Exhibits.
II-2
Table of Contents
**
Previously filed.
Item 37.
Undertakings
II-3
Table of Contents
II-4
Table of Contents
ACQUISITIONS OF PROPERTIES BY PROGRAMS
SPONSORED BY THOMPSON NATIONAL PROPERTIES, LLC
(UNAUDITED)
Gross
Leasable
Space or
Number of
Units and
Total
Square
Mortgage
Contract
Other
Other
Feet
Financing
Cash
Price &
Cash
Cash
Type of
(SF of
Date of
At
Down
Acquisition
Expenditure
Expenditures
Total
Ownership
Location
Property
Units
Purchase
Purchase
Payment
Fee
Expensed
Capitalized
Price
One Lee Park
Bruin Fund, L.P.
Dallas, TX
Office
78,000/47,780
and
71,491/47,591
(rsf)
5/12/08
$
8,760,375
$
3,894,636
$
12,879,636
$
276,857
$
13,156,493
TNP Vulture
Fund VIII, LLC
Las Vegas, NV
Condominium
2,050
9/17/08
$
625,000
$
625,000(1
)
$
1,565
$
626,565
TNP Vulture
Fund VIII, LLC
Park City, UT
Retail/Office
15,044/13,990
9/8/08
$
1,675,170
$
1,634,080
$
3,400,750
$
35,949
$
3,436,699
TNP Vulture
Fund VIII, LLC
Las Vegas, NV
Office
207,589/200,647
10/3/08
$
12,574,095
$
8,925,905
$
21,500,000(2
)
$
404,242
$
21,904,242
TNP Vulture
Fund VIII , LLC
Duncan, SC
Land
+/-32.27 acres
10/3/08
$
700,000
$
643,750(3
)
$
4,708
$
648,458
(1)
An acquisition fee of $18,750 has not been paid as of
December 31, 2008 and is not included in the total above.
(2)
An acquisition fee of $351,718 has not been paid as of
December 31, 2008 and is not included in the total above.
(3)
An acquisition fee of $18,750 was paid on October 6, 2008
and is included in the total above and an additional $12,500 of
acquisition fees has not been paid at December 31, 2008 and
is not included in the total above.
II-5
Table of Contents
Program:
Name, location, type of property
T REIT, Inc.
AmberOaks Corporate Center
(1)
Austin, TX
Office
T REIT, Inc.
Oakey Building
(2)
Las Vegas, NV
Office
207,000
98,000
1/20/2004
4/2/2004
$
15,000,000
$
4,000,000
$
7,965,000
$
4,137,000
$
22,965,000
$
8,137,000
$
(127,000
)
$
15,000
$
198,000
$
100,000
$
23,036,000
$
8,252,000
Program:
Name, location, type of property
T REIT, Inc.
Emerald Plaza
(3)
San Diego, CA
Office
G REIT, Inc.
AmberOaks Corporate Center
Austin, TX
Office
355,000
282,000
6/14/2004
1/20/2004
$
68,500,000
$
14,250,000
$
32,440,000
$
21,275,000
$
100,940,000
$
35,525,000
$
(361,000
)
$
(191,000
)
$
325,000
$
1,191,000
$
100,904,000
$
36,525,000
Program:
Name, location, type of property
G REIT, Inc.
Public Ledger Building
Philadelphia, PA
Office
G REIT, Inc.
Madrona Buildings
Torrance, CA
Office
467,000
211,000
2/13/2004
3/31/2004
$
25,000,000
$
28,458,000
$
8,950,000
$
17,442,000
$
33,950,000
$
45,900,000
$
(118,000
)
$
88,000
$
1,747,000
$
1,908,000
$
35,579,000
$
47,896,000
(1)
Owns a 75% tenant in common interest in the property.
(2)
Owns 9.8% of the property through a membership interest in NNN
Oakey Building 2003, LLC which owns 100% of the property.
(3)
Owns 2.7% of the property through a membership interest in NNN
Emerald Plaza, LLC which owns 20.5% of the property as a tenant
in common.
II-6
Table of Contents
Program:
Name, location, type of property
G REIT, Inc.
Brunswig Square
Los Angeles, CA
Office
G REIT, Inc.
North Belt Corporate Center
Houston, TX
Office
136,000
157,000
4/5/2004
4/8/2004
$
15,830,000
$
$
7,975,000
$
12,675,000
$
23,805,000
$
12,675,000
$
$
(17,000
)
$
773,000
$
405,000
$
24,578,000
$
13,063,000
Program:
Name, location, type of property
G REIT, Inc.
Hawthorne Plaza
San Francisco, CA
Office
G REIT, Inc.
Pacific Place
Dallas, TX
Office
422,000
324,000
4/20/2004
5/26/2004
$
62,750,000
$
$
34,250,000
$
29,900,000
$
97,000,000
$
29,900,000
$
(49,000
)
$
(65,000
)
$
3,354,000
$
1,240,000
$
100,305,000
$
31,075,000
Program:
Name, location, type of property
G REIT, Inc.
525 B Street (Golden Eagle)
San Diego, CA
Office
G REIT, Inc.
600 B Street (Comerica)
San Diego, CA
Office
424,000
339,000
6/14/2004
6/14/2004
$
69,943,000
$
56,057,000
$
26,367,000
$
21,133,000
$
96,310,000
$
77,190,000
$
(387,000
)
$
(235,000
)
$
2,318,000
$
1,917,000
$
98,241,000
$
78,872,000
II-7
Table of Contents
Program:
Name, location, type of property
G REIT, Inc.
Western Place I & II
(1)
Forth Worth, TX
Office
G REIT, Inc.
Pax River Office Park
Lexington Park, MD
Office
430,000
172,000
7/23/2004
8/6/2004
$
24,000,000
$
$
9,500,000
$
14,000,000
$
33,500,000
$
14,000,000
$
(137,000
)
$
(88,000
)
$
1,569,000
$
720,000
$
34,932,000
$
14,632,000
Program:
Name, location, type of property
G REIT, Inc.
One Financial Plaza
(2)
St. Louis, MO
Office
G REIT, Inc.
Opus Plaza at Ken Caryl
Littleton, CO
Office
434,000
62,000
8/6/2004
9/12/2005
$
30,750,000
$
6,700,000
$
6,250,000
$
3,476,000
$
37,000,000
$
10,176,000
$
(728,000
)
$
(40,000
)
$
1,186,000
$
150,000
$
37,458,000
$
10,286,000
Program:
Name, location, type of property
G REIT, Inc.
Eaton Freeway
Phoenix, AZ
Industrial
NNN 2003 Value Fund, LLC
801 K Street
(3)
Sacramento, CA
Office
62,000
336,000
10/21/2005
3/31/2004
$
5,000,000
$
41,350,000
$
2,588,000
$
24,430,000
$
7,588,000
$
65,780,000
$
(10,000
)
$
665,000
$
224,000
$
560,000
$
7,802,000
$
67,005,000
(1)
Owns a 78.5% tenant in common interest in the property.
(2)
Owns a 77.6% tenant in common interest in the property.
(3)
Owns 18.3% of the property through a membership interest in NNN
801 K Street, LLC, which owns 21.5% of the property as
a tenant in common.
II-8
Table of Contents
Program:
Name, location, type of property
NNN 2003 Value Fund, LLC
Oakey Building
(1)
Las Vegas, NV
Office
NNN 2003 Value Fund, LLC
Enterprise Technology Center
(2)
Scotts Valley, CA
Office
98,000
370,000
4/2/2004
5/7/2004
$
4,000,000
$
36,500,000
$
4,137,000
$
24,800,000
$
8,137,000
$
61,300,000
$
15,000
$
(329,000
)
$
100,000
$
187,000
$
8,252,000
$
61,158,000
Program:
Name, location, type of property
NNN 2003 Value Fund, LLC
Emerald Plaza
(3)
San Diego, CA
Office
NNN 2003 Value Fund, LLC
Southwood Tower
Houston, TX
Office
355,000
79,000
6/14/2004
10/27/2004
$
68,500,000
$
$
32,440,000
$
5,461,000
$
100,940,000
$
5,461,000
$
(361,000
)
$
121,000
$
325,000
$
10,000
$
100,904,000
$
5,592,000
Program:
Name, location, type of property
NNN 2003 Value Fund, LLC
Financial Plaza
Omaha, NE
Office
NNN 2003 Value Fund, LLC
Satellite Place
Atlanta, GA
Office
86,000
178,000
10/29/2004
11/29/2004
$
4,125,000
$
11,000,000
$
1,535,000
$
7,300,000
$
5,660,000
$
18,300,000
$
(6,000
)
$
4,000
$
19,000
$
230,000
$
5,673,000
$
18,534,000
(1)
Owns 75.4% of the property through a membership interest in NNN
Oakey Building 2003, LLC which owns 100% of the property.
(2)
Owns 8.5% of the property through a membership interest in NNN
Enterprise Way, LLC which owns 11.6% of the property as a tenant
in common.
(3)
Owns 4.6% of the property through a membership interest in NNN
Emerald Plaza, LLC which owns 20.5% of the property as a tenant
in common.
II-9
Table of Contents
Program:
Name, location, type of property
NNN 2003 Value Fund, LLC
Interwood
Houston, TX
Office
NNN 2003 Value Fund, LLC
Woodside Corporate Park
Beaverton, OR
Office
80,000
195,000
1/26/2005
9/30/2005
$
5,500,000
$
15,915,000
$
2,500,000
$
6,947,000
$
8,000,000
$
22,862,000
$
4,000
$
(5,000
)
$
371,000
$
1,132,000
$
8,375,000
$
23,989,000
Program:
Name, location, type of property
NNN 2003 Value Fund, LLC
Daniels Rd land parcel
Heber City, UT
Land
NNN 2003 Value Fund, LLC
3500 Maple
(1)
Dallas, TX
Office
9.05 acres
375,000
10/14/2005
12/27/2005
$
$
58,320,000
$
729,000
$
8,180,000
$
729,000
$
66,500,000
$
1,000
$
(638,000
)
$
1,000
$
(749,000
)
$
731,000
$
65,113,000
Program:
Name, location, type of property
NNN 2003 Value Fund, LLC
901 Civic Center Drive
(2)
Santa Ana, CA
Office
NNN 2003 Value Fund, LLC
Chase Tower
(3)
Austin, TX
Office
99,000
389,000
4/24/2006
7/3/2006
$
$
54,800,000
$
15,147,000
$
17,700,000
$
15,147,000
$
72,500,000
$
(7,000
)
$
5,000
$
29,000
$
1,475,000
$
15,169,000
$
73,980,000
(1)
Owns 99.0% of the property through a membership interest in NNN
3500 Maple VF 2003, LLC, which owns 99% of the property.
(2)
Owns 96.9% of the property through a membership interest in NNN
VF 901 Civic, LLC, which owns 96.9% of the property.
(3)
Owns a 14.8% tenant in common interest in the property.
II-10
Table of Contents
Program:
Name, location, type of property
NNN 2003 Value Fund, LLC
Tiffany Square
Colorado Springs, CO
Office
184,000
11/15/2006
$
$
11,052,000
$
11,052,000
$
$
150,000
$
11,202,000
Program:
Name, location, type of property
Grubb & Ellis Apartment
REIT, Inc.
Walker Ranch
San Antonio, TX
Apartment
Grubb & Ellis Apartment
REIT, Inc.
Hidden Lake
San Antonio, TX
Apartment
325/285,000
380/304,000
10/31/2006
12/28/2006
$
26,860,000
$
31,718,000
$
4,813,000
$
1,273,000
$
31,673,000
$
32,991,000
$
(8,000
)
$
(33,000
)
$
141,000
$
150,000
$
31,806,000
$
33,108,000
II-11
Table of Contents
ACQUISITION OF PROPERTIES BY PROGRAMS
SPONSORED BY TRIPLE NET PROPERTIES, LLC (UNAUDITED)
Program:
Name, location, type of property
NNN Amber Oaks, LLC
(1)
AmberOaks Corporate Center
Austin, TX
Office
NNN Arapahoe Service
Center 1, LLC
Arapahoe Service Center
Englewood, CO
Office
207,000
144,000
1/20/2004
1/29/2004
$
15,000,000
$
6,500,000
$
7,965,000
$
3,600,000
$
22,965,000
$
10,100,000
$
(127,000
)
$
45,000
$
198,000
$
54,000
$
23,036,000
$
10,199,000
Program:
Name, location, type of property
NNN Lakeside Tech, LLC
Lakeside Tech Center
Tampa, FL
Office
NNN 100 Cyberonics Drive, LLC
100 Cyberonics Drive
Houston, TX
Office
223,000
144,000
2/6/2004
3/19/2004
$
14,625,000
$
10,500,000
$
5,163,000
$
5,080,000
$
19,788,000
$
15,580,000
$
(99,000
)
$
(122,000
)
$
192,000
$
96,000
$
19,881,000
$
15,554,000
Program:
Name, location, type of property
NNN Corporate Court, LLC
Corporate Court
Irving, TX
Office
NNN 801 K Street, LLC
(2)
801 K Street
Sacramento, CA
Office
67,000
336,000
3/25/2004
3/31/2004
$
5,000,000
$
41,350,000
$
2,570,000
$
24,430,000
$
7,570,000
$
65,780,000
$
(57,000
)
$
665,000
$
116,000
$
560,000
$
7,629,000
$
67,005,000
(1)
T REIT, Inc., a Triple Net affiliated public entity, owned a
tenant in common interest of 75% in the program.
(2)
NNN 2003 Value Fund, LLC, a Triple Net affiliated public entity,
owned an 85% membership interest in NNN 801 K Street, LLC which
had a 21.5% tenant in common interest in the program.
II-12
Table of Contents
ACQUISITION OF PROPERTIES BY PROGRAMS
SPONSORED BY TRIPLE NET PROPERTIES, LLC (UNAUDITED)
Program:
Name, location, type of property
NNN Oakey Building 2003,
LLC
(1),(2)
Oakey Building
Las Vegas, NV
Office
NNN Enterprise Way, LLC
(3)
Enterprise Technology Center
Scotts Valley, CA
Office
98,000
370,000
4/2/2004
5/7/2004
$
4,000,000
$
36,500,000
$
4,137,000
$
24,800,000
$
8,137,000
$
61,300,000
$
15,000
$
(329,000
)
$
100,000
$
187,000
$
8,252,000
$
61,158,000
Program:
Name, location, type of property
NNN River Rock Business
Center, LLC
River Rock Business Center
Murfreesboro, TN
Office
NNN Emerald Plaza,
LLC
(4),(5)
Emerald Plaza
San Diego, CA
Office
158,000
355,000
6/11/2004
6/14/2004
$
9,300,000
$
68,500,000
$
5,900,000
$
32,440,000
$
15,200,000
$
100,940,000
$
(36,000
)
$
(361,000
)
$
181,000
$
325,000
$
15,345,000
$
100,904,000
Program:
Name, location, type of property
NNN Great Oaks Center, LLC
Great Oaks Center
Atlanta, GA
Office
NNN Sugar Creek Center, LLC
Two Sugar Creek
Houston, TX
Office
233,000
143,000
6/30/2004
7/12/2004
$
20,000,000
$
16,000,000
$
7,050,000
$
5,850,000
$
27,050,000
$
21,850,000
$
(131,000
)
$
(220,000
)
$
126,000
$
231,000
$
27,045,000
$
21,861,000
(1)
T REIT, Inc., a Triple Net affiliated public entity, owned a
membership interest of 9.76% in NNN Oakey Building 2003, LLC
which owned 100.00% of the property.
(2)
NNN 2003 Value Fund, LLC, a Triple Net affiliated public entity,
owned a membership interest of 75.46% in NNN Oakey Building
2003, LLC which owned 100.00% of the property.
(3)
NNN 2003 Value Fund, LLC, a Triple Net affiliated public entity,
owns a 73.3% membership interest in NNN Enterprise Way, LLC
which has an 11.625% tenant in common interest in the program.
(4)
T REIT, Inc., a Triple Net affiliated public entity, owned a
13.17% membership interest in NNN Emerald Plaza, LLC which owned
a 20.5% tenant in common interest in the program.
(5)
NNN 2003 Value Fund, LLC, a Triple Net affiliated public entity,
owned a 22.4% membership interest in NNN Emerald Plaza, LLC
which owned a 20.5% tenant in common interest in the program.
II-13
Table of Contents
ACQUISITION OF PROPERTIES BY PROGRAMS
SPONSORED BY TRIPLE NET PROPERTIES, LLC (UNAUDITED)
Program:
Name, location, type of property
NNN Beltway 8 Corporate
Centre, LLC
Beltway 8 Corporate Centre
Houston, TX
Office
NNN Western Place, LLC
(1)
Western Place I and II
Fort Worth, TX
Office
101,000
430,000
7/22/2004
7/23/2004
$
10,530,000
$
24,000,000
$
5,670,000
$
9,500,000
$
16,200,000
$
33,500,000
$
(173,000
)
$
(137,000
)
$
469,000
$
1,569,000
$
16,496,000
$
34,932,000
Name, location, type of property
NNN One Financial Plaza,
LLC
(2)
One Financial Plaza
St. Louis, MO
Office
NNN Reserve at Maitland, LLC
Reserve at Mairland
Maitland, FL
Office
434,000
197,000
8/6/2004
8/18/2004
$
30,750,000
$
21,750,000
$
6,250,000
$
8,120,000
$
37,000,000
$
29,870,000
$
(728,000
)
$
(256,000
)
$
1,186,000
$
322,000
$
37,458,000
$
29,936,000
Name, location, type of property
NNN Las Cimas, LLC
Las Cimas II and III
Austin, TX
Office
NNN 9800 Goethe Road, LLC
9800 Goethe Road
Sacramento, CA
Office
313,000
111,000
9/27/2004
10/7/2004
$
46,800,000
$
14,800,000
$
26,300,000
$
3,050,000
$
73,100,000
$
17,850,000
$
(547,000
)
$
219,000
$
775,000
$
977,000
$
73,328,000
$
19,046,000
(1)
The program owns a 21.5% tenant in common interest in the
property.
(2)
The program owns a 22.4% tenant in common interest in the
property.
II-14
Table of Contents
ACQUISITION OF PROPERTIES BY PROGRAMS
SPONSORED BY TRIPLE NET PROPERTIES, LLC (UNAUDITED)
Program:
Name, location, type of property
NNN Fountain Square, LLC
Fountain Square
Boca Raton, FL
Office
NNN Embassy Plaza, LLC
Embassy Plaza
Omaha, NE
Office
242,000
132,000
10/28/2004
10/29/2004
$
36,250,000
$
9,900,000
$
15,250,000
$
7,100,000
$
51,500,000
$
17,000,000
$
(510,000
)
$
(189,000
)
$
1,059,000
$
153,000
$
52,049,000
$
16,964,000
Name, location, type of property
NNN City Centre Place, LLC
City Centre Place
Las Vegas, NV
Office
NNN Oak Park Office Center,
LLC
Oak Park Office Center
Houston, TX
Office
103,000
173,000
11/5/2004
11/12/2004
$
21,500,000
$
21,800,000
$
7,980,000
$
7,349,000
$
29,480,000
$
29,149,000
$
111,000
$
(90,000
)
$
170,000
$
598,000
$
29,761,000
$
29,657,000
Name, location, type of property
NNN/Mission Spring Creek,
LLC
Mission Spring Creek
Apartments
Garland, TX
Apartment
NNN 2800 East Commerce,
LLC
2800 East Commerce Place
Tucson, AZ
Office
196,000
136,000
11/12/2004
11/19/2004
$
8,750,000
$
11,375,000
$
2,763,000
$
6,650,000
$
11,513,000
$
18,025,000
$
(25,000
)
$
93,000
$
(166,000
)
$
195,000
$
11,322,000
$
18,313,000
II-15
Table of Contents
ACQUISITION OF PROPERTIES BY PROGRAMS
SPONSORED BY TRIPLE NET PROPERTIES, LLC (UNAUDITED)
Program:
Name, location, type of property
NNN Satellite Place, LLC
Satellite Place Office Park
Duluth, GA
Office
NNN Fountainhead, LLC
Fountainhead Park I and II
San Antonio, TX
Office
112,000
171,000
11/29/2004
12/8/2004
$
8,500,000
$
18,900,000
$
3,756,000
$
8,450,000
$
12,256,000
$
27,350,000
$
21,000
$
94,000
$
180,000
$
183,000
$
12,457,000
$
27,627,000
Program:
Name, location, type of property
NNN/Mission University Place,
LLC
Mission University Place
Apartments
Charlotte, NC
Apartment
NNN/Mission Mallard Creek,
LLC
Mission Mallard Creek
Apartments
Charlotte, NC
Apartment
231,000
233,000
12/30/2004
12/30/2004
$
11,500,000
$
9,300,000
$
4,500,000
$
5,038,000
$
16,000,000
$
14,338,000
$
27,000
$
21,000
$
227,000
$
194,000
$
16,254,000
$
14,553,000
Program:
Name, location, type of property
NNN SFS Town Center, LLC
Town Center Business Park
Santa Fe Springs, CA
Office
NNN 4 Hutton, LLC
4 Hutton Centre Drive
South Coast Metro, CA
Office
177,000
210,000
1/6/2005
1/7/2005
$
22,000,000
$
32,000,000
$
8,910,000
$
17,000,000
$
30,910,000
$
49,000,000
$
(27,000
)
$
(230,000
)
$
343,000
$
724,000
$
31,226,000
$
49,494,000
II-16
Table of Contents
ACQUISITION OF PROPERTIES BY PROGRAMS
SPONSORED BY TRIPLE NET PROPERTIES, LLC (UNAUDITED)
Program:
Name, location, type of property
NNN/Mission Collin Creek,
LLC
Mission Collin Creek
Apartments
Plano, TX
Apartment
NNN Satellite 1100 & 2000,
LLC
Satellite Place Office Park
Duluth, GA
Office
267,000
175,000
1/19/2005
2/24/2005
$
13,600,000
$
13,900,000
$
4,683,000
$
5,510,000
$
18,283,000
$
19,410,000
$
(16,000
)
$
(18,000
)
$
257,000
$
225,000
$
18,524,000
$
19,617,000
Program:
Name, location, type of property
NNN Chatsworth Business Park,
LLC
Chatsworth Business Park
Chatsworth, CA
Office
NNN Met Center 10, LLC
Building Ten Met Center
Austin, TX
Office
232,000
346,000
3/30/2005
4/8/2005
$
33,750,000
$
32,000,000
$
13,025,000
$
12,880,000
$
46,775,000
$
44,880,000
$
131,000
$
(257,000
)
$
(889,000
)
$
540,000
$
46,017,000
$
45,163,000
Program:
Name, location, type of property
NNN 2400 West Marshall Drive,
LLC
2400 West Marshall Drive
Grand Prairie, TX
Office
NNN 411 East Wisconsin, LLC
411 East Wisconsin Avenue
Milwaukee, WI
Office
111,000
654,000
4/12/2005
4/29/2005
$
6,875,000
$
70,000,000
$
2,595,000
$
25,000,000
$
9,470,000
$
95,000,000
$
(9,000
)
$
25,000
$
192,000
$
1,268,000
$
9,653,000
$
96,293,000
II-17
Table of Contents
ACQUISITION OF PROPERTIES BY PROGRAMS
SPONSORED BY TRIPLE NET PROPERTIES, LLC (UNAUDITED)
Program:
Name, location, type of property
NNN Naples Tamiami Trail,
LLC
4501 Tamiami Trail
Naples, FL
Office
NNN Naples Laurel Oak, LLC
800 Laurel Oak Drive
Naples, FL
Office
78,000
41,000
5/2/2005
5/2/2005
$
13,500,000
$
9,500,000
$
7,500,000
$
6,700,000
$
21,000,000
$
16,200,000
$
(10,000
)
$
7,000
$
312,000
$
271,000
$
21,302,000
$
16,478,000
Program:
Name, location, type of property
NNN Park at Spring Creek,
LLC
The Park at Spring Creek
Apartments
Tomball, TX
Apartment
NNN Inverness Business Park,
LLC
Inverness Business Park
Englewood, CO
Office
185,000
112,000
6/8/2005
6/10/2005
$
11,040,000
$
9,500,000
$
3,277,000
$
3,450,000
$
14,317,000
$
12,950,000
$
(41,000
)
$
(18,000
)
$
323,000
$
40,000
$
14,599,000
$
12,972,000
Program:
Name, location, type of property
NNN Waterway Plaza, LLC
Waterway Plaza I and II
The Woodlands, TX
Office
NNN Papago Spectrum, LLC
Papago Spectrum
Tempe, AZ
Office
366,000
160,000
6/20/2005
7/29/2005
$
60,000,000
$
19,000,000
$
14,148,000
$
7,375,000
$
74,148,000
$
26,375,000
$
(66,000
)
$
183,000
$
546,000
$
827,000
$
74,628,000
$
27,385,000
II-18
Table of Contents
ACQUISITION OF PROPERTIES BY PROGRAMS
SPONSORED BY TRIPLE NET PROPERTIES, LLC (UNAUDITED)
Program:
Name, location, type of property
NNN Sanctuary at Highland
Oak,
DST
The Sanctuary at Highland Oaks
Tampa, FL
Apartment
NNN Met Center 15, LLC
Building 15 Met Center
Austin, TX
Office
495,000
258,000
7/29/2005
8/19/2005
$
35,300,000
$
28,000,000
$
19,240,000
$
9,500,000
$
54,540,000
$
37,500,000
$
162,000
$
(383,000
)
$
867,000
$
591,000
$
55,569,000
$
37,708,000
Program:
Name, location, type of property
NNN One Chesterfield Place,
LLC
One Chesterfield Place
Chesterfield, MO
Office
NNN Maitland Promenade,
LLC
Maitland Promenade II
Orlando, FL
Office
143,000
230,000
9/9/2005
9/12/2005
$
18,810,000
$
32,250,000
$
9,664,000
$
12,143,000
$
28,474,000
$
44,393,000
$
(76,000
)
$
(78,000
)
$
346,000
$
470,000
$
28,744,000
$
44,785,000
Program:
Name, location, type of property
NNN Sixth Avenue West, LLC
Sixth Avenue West
Golden, CO
Office
NNN St. Charles,
St. Charles Apartments
Kennesaw, GA
Apartment
125,000
200,000
9/13/2005
9/27/2005
$
10,300,000
$
12,100,000
$
5,200,000
$
5,714,000
$
15,500,000
$
17,814,000
$
(94,000
)
$
23,000
$
(434,000
)
$
252,000
$
14,972,000
$
18,089,000
II-19
Table of Contents
ACQUISITION OF PROPERTIES BY PROGRAMS
SPONSORED BY TRIPLE NET PROPERTIES, LLC (UNAUDITED)
Program:
Name, location, type of property
NNN 123 Wacker, LLC
123 Wacker Building
Chicago, IL
Office
NNN Netpark II, LLC
Netpark Tampa Bay
(1)
Tampa, FL
Office
541,000
913,000
9/28/2005
9/30/2005
$
136,000,000
$
21,500,000
$
37,680,000
$
12,000,000
$
173,680,000
$
33,500,000
$
958,000
$
(20,000
)
$
2,652,000
$
1,008,000
$
177,290,000
$
34,488,000
Program:
Name, location, type of property
NNN Britannia Business
Center III, LLC
Britannia Business Center
Pleasanton, CA
Office
NNN Britannia Business
Center II, LLC
Britannia Business Center
Pleasanton, CA
Office
191,000
276,000
9/30/2005
9/30/2005
$
35,000,000
$
41,000,000
$
10,290,000
$
17,610,000
$
45,290,000
$
58,610,000
$
(101,000
)
$
(129,000
)
$
467,000
$
435,000
$
45,656,000
$
58,916,000
Program:
Name, location, type of property
NNN Woodside Corporate
Park, LLC
Woodside Corporate Park
Beaverton, OR
Office
NNN Britannia Business
Center I, LLC
Britannia Business Center
Pleasanton, CA
Office
383,000
297,000
9/30/2005
10/14/2005
$
33,500,000
$
60,000,000
$
12,000,000
$
22,989,000
$
45,500,000
$
82,989,000
$
(405,000
)
$
(276,000
)
$
550,000
$
867,000
$
45,645,000
$
83,580,000
(1)
NNN 2002 Value Fund, LLC, a Triple Net affiliated public entity,
sold its 50% tenant in common interest in the property to an
affiliated program, NNN Netpark II, LLC.
II-20
Table of Contents
ACQUISITION OF PROPERTIES BY PROGRAMS
SPONSORED BY TRIPLE NET PROPERTIES, LLC (UNAUDITED)
Program:
Name, location, type of property
NNN Saturn Business Park,
LLC
Saturn Business Park
Brea, CA
Office
NNN Parkway Crossing, LLC
Parkway Crossing Apartments
Asheville, NC
Apartment
121,000
184,000
10/20/2005
10/28/2005
$
16,100,000
$
9,100,000
$
6,560,000
$
2,230,000
$
22,660,000
$
11,330,000
$
14,000
$
10,000
$
60,000
$
189,000
$
22,734,000
$
11,529,000
Program:
Name, location, type of property
NNN Forest Office Park, LLC
Forest Office Park
Richmond, VA
Office
NNN Doral Court, LLC
Doral Court
Miami, FL
Office
223,000
209,000
11/9/2005
11/15/2005
$
15,300,000
$
19,640,000
$
5,550,000
$
13,640,000
$
20,850,000
$
33,280,000
$
(87,000
)
$
50,000
$
406,000
$
1,057,000
$
21,169,000
$
34,387,000
Program:
Name, location, type of property
NNN Talavi Corp Center, LLC
Talavi Corporate Center
Glendale, AZ
Office
NNN One Nashville Place, LLC
One Nashville Place
Nashville, TN
Office
153,000
411,000
11/23/2005
11/30/2005
$
24,000,000
$
58,000,000
$
8,875,000
$
21,750,000
$
32,875,000
$
79,750,000
$
17,000
$
54,000
$
375,000
$
1,590,000
$
33,267,000
$
81,394,000
II-21
Table of Contents
ACQUISITION OF PROPERTIES BY PROGRAMS
SPONSORED BY TRIPLE NET PROPERTIES, LLC (UNAUDITED)
Program:
Name, location, type of property
NNN 633 17th Street, LLC
633 17th Street
Denver, CO
Office
NNN 300 Four Falls, LLC
300 Conshohocken State Road
W. Conshohocken, PA
Office
553,000
298,000
12/9/2005
12/14/2005
$
67,500,000
$
72,000,000
$
24,780,000
$
28,525,000
$
92,280,000
$
100,525,000
$
(70,000
)
$
327,000
$
1,087,000
$
2,019,000
$
93,297,000
$
102,871,000
Program:
Name, location, type of property
NNN 3500 Maple, LLC
3500 Maple Street
Dallas, TX
Office
NNN The Landing, LLC
The Landing Apartments
Durham, NC
Apartment
375,000
192,000
12/27/2005
12/30/2005
$
58,320,000
$
9,700,000
$
8,180,000
$
3,536,000
$
66,500,000
$
13,236,000
$
(638,000
)
$
14,000
$
(749,000
)
$
79,000
$
65,113,000
$
13,329,000
Program:
Name, location, type of property
NNN Caledon Wood, LLC
Caledon Wood Apartments
Greenville, SC
Apartment
NNN Mission Square, LLC
Misson Square
Riverside, CA
Office
348,000
128,000
1/3/2006
1/10/2006
$
17,000,000
$
24,225,000
$
6,816,000
$
9,275,000
$
23,816,000
$
33,500,000
$
51,000
$
(10,000
)
$
89,000
$
365,000
$
23,956,000
$
33,855,000
II-22
Table of Contents
ACQUISITION OF PROPERTIES BY PROGRAMS
SPONSORED BY TRIPLE NET PROPERTIES, LLC (UNAUDITED)
Program:
Name, location, type of property
NNN Highbrook Apartments,
LLC
Highbrook Apartments
High Point, NC
Apartment
NNN Gateway One, LLC
701 Market Street
St. Louis, MO
Office
280,000
410,000
1/19/2006
2/9/2006
$
16,925,000
$
50,000,000
$
6,466,000
$
16,600,000
$
23,391,000
$
66,600,000
$
(4,000
)
$
(139,000
)
$
330,000
$
753,000
$
23,717,000
$
67,214,000
Program:
Name, location, type of property
NNN 1818 Market Street, LLC
1818 Market Street
Philadelphia, PA
Office
NNN Meadows Apartments,
LLC
The Meadows Apartments
Asheville, NC
Apartment
983,000
387,000
2/21/2006
3/15/2006
$
132,000,000
$
21,300,000
$
25,384,000
$
7,100,000
$
157,384,000
$
28,400,000
$
1,943,000
$
(73,000
)
$
5,384,000
$
121,000
$
164,711,000
$
28,448,000
Program:
Name, location, type of property
NNN Enclave at Deep River,
LLC
The Enclave at Deep River
Plantation
High Point, NC
Apartment
NNN Aventura Harbour, LLC
Harbour Centre
Aventura, FL
Office
224,000
214,000
3/17/2006
4/28/2006
$
13,725,000
$
51,180,000
$
5,307,000
$
20,015,000
$
19,032,000
$
71,195,000
$
(81,000
)
$
(660,000
)
$
112,000
$
5,276,000
$
19,063,000
$
75,811,000
II-23
Table of Contents
ACQUISITION OF PROPERTIES BY PROGRAMS
SPONSORED BY TRIPLE NET PROPERTIES, LLC (UNAUDITED)
Program:
Name, location, type of property
NNN Arbor Trace Apartments,
LLC
Arbor Trace Apartments
Virginia Beach, VA
Apartment
NNN Lake Center, LLC
Lake Center Four
Marlton, NJ
Office
125,000
89,000
5/1/2006
5/18/2006
$
11,063,000
$
14,830,000
$
4,129,000
$
4,969,000
$
15,192,000
$
19,799,000
$
108,000
$
(56,000
)
$
290,000
$
791,000
$
15,590,000
$
20,534,000
Program:
Name, location, type of property
NNN 3050 Superior, LLC
3050 Superior Drive NW
Rochester, MN
Office
NNN Chase Tower, LLC
Chase Tower
Austin, TX
Office
205,000
389,000
5/18/2006
7/3/2006
$
28,100,000
$
54,800,000
$
8,775,000
$
17,700,000
$
36,875,000
$
72,500,000
$
(441,000
)
$
5,000
$
873,000
$
1,475,000
$
37,307,000
$
73,980,000
Program:
Name, location, type of property
NNN Las Colinas Highlands,
LLC
Las Colinas Highlands
Irving, TX
Office
NNN 220 Virginia Avenue,
LLC
220 Virginia Avenue
Indianapolis, IN
Office
199,000
562,000
6/27/2006
6/29/2006
$
32,000,000
$
84,405,000
$
12,148,000
$
16,395,000
$
44,148,000
$
100,800,000
$
(235,000
)
$
(594,000
)
$
784,000
$
420,000
$
44,697,000
$
100,626,000
II-24
Table of Contents
ACQUISITION OF PROPERTIES BY PROGRAMS
SPONSORED BY TRIPLE NET PROPERTIES, LLC (UNAUDITED)
Program:
Name, location, type of property
NNN Villa Apartments, LLC
Villas by the Lakes Apartments
Jonesboro, GA
Apartment
NNN 2716 North Tenaya, LLC
Sierra Health Building
Las Vegas, NV
Office
283,000
204,000
7/7/2006
7/25/2006
$
14,925,000
$
50,750,000
$
5,572,000
$
23,500,000
$
20,497,000
$
74,250,000
$
(41,000
)
$
(42,000
)
$
598,000
$
1,892,000
$
21,054,000
$
76,100,000
Program:
Name, location, type of property
NNN Westlake Villa, LLC
Westlake Villas Apartments
San Antonio, TX
Apartment
NNN 400 Capitol, LLC
The Regions Center
Little Rock, AR
Office
223,000
532,000
8/8/2006
8/18/2006
$
11,325,000
$
32,000,000
$
4,228,000
$
6,368,000
$
15,553,000
$
38,368,000
$
(313,000
)
$
(167,000
)
$
373,000
$
1,746,000
$
15,613,000
$
39,947,000
Program:
Name, location, type of property
NNN Southcreek Corporate,
LLC
Southcreek Corporate Center II
Overland Park, KS
Office
NNN Chatham Court/
Reflections, LLC
Chatham Court
Dallas, TX
Apartment
56,000
378,000
9/1/2006
9/8/2006
$
6,000,000
$
18,938,000
$
2,000,000
$
7,070,000
$
8,000,000
$
26,008,000
$
(48,000
)
$
(207,000
)
$
59,000
$
826,000
$
8,011,000
$
26,627,000
II-25
Table of Contents
ACQUISITION OF PROPERTIES BY PROGRAMS
SPONSORED BY TRIPLE NET PROPERTIES, LLC (UNAUDITED)
Program:
Name, location, type of property
NNN Arbors at Fairview, LLC
Arbors at Fairview Apartments
Simpsonville, SC
Apartment
NNN 1 & 2 Met Center, LLC
Met Center 1 & 2
Austin, TX
Office
181,000
95,000
10/12/2006
10/13/2006
$
10,500,000
$
8,600,000
$
3,920,000
$
3,420,000
$
14,420,000
$
12,020,000
$
(53,000
)
$
(234,000
)
$
834,000
$
104,000
$
15,201,000
$
11,890,000
Program:
Name, location, type of property
NNN 250 East 5th Street, LLC
250 East 5th Street
Cincinnati, OH
Office
One Northlake Place, LLC
11500 Northlake Drive
Cincinnati, OH
Office
537,000
177,000
10/25/2006
10/27/2006
$
65,000,000
$
13,350,000
$
27,756,000
$
4,100,000
$
92,756,000
$
17,450,000
$
(153,000
)
$
4,000
$
805,000
$
272,000
$
93,408,000
$
17,726,000
Program:
Name, location, type of property
NNN DCF Campus, LLC
Department of Children
and Families
Plantation, FL
Office
NNN Beechwood Apartments,
LLC
Beechwood Apartments
Greensboro, NC
Apartment
118,000
173,000
11/15/2006
11/17/2006
$
10,090,000
$
8,625,000
$
3,300,000
$
3,220,000
$
13,390,000
$
11,845,000
$
(229,000
)
$
(7,000
)
$
369,000
$
268,000
$
13,530,000
$
12,106,000
II-26
Table of Contents
ACQUISITION OF PROPERTIES BY PROGRAMS
SPONSORED BY TRIPLE NET PROPERTIES, LLC (UNAUDITED)
Program:
Name, location, type of property
NNN Westpoint, LLC
1255 Corporate Drive
Irving, TX
Office
NNN Castaic Town Center,
LLC
Castaic Town Center
Castaic, CA
Retail
150,000
40,000
11/29/06
11/30/2006
$
15,125,000
$
11,250,000
$
5,675,000
$
4,150,000
$
20,800,000
$
15,400,000
$
(11,000
)
$
26,000
$
269,000
$
572,000
$
21,058,000
$
15,998,000
Program:
Name, location, type of property
NNN Northwoods, LLC
Northwoods II
Columbus, OH
Office
NNN 50 Lake Center , LLC
Lake Center V
Marlton, NJ
Office
116,000
89,000
12/8/2006
12/15/2006
$
8,200,000
$
16,425,000
$
2,770,000
$
6,075,000
$
10,970,000
$
22,500,000
$
(43,000
)
$
(634,000
)
$
186,000
$
628,000
$
11,113,000
$
22,494,000
Program:
Name, location, type of property
NNN Mt. Moriah Apartments,
LLC
The Trails at Mt. Moriah
Apartments
Memphis, TN
Apartment
NNN 1600 Parkwood, LLC
1600 Parkwood Circle
Atlanta, GA
Office
539,000
151,000
12/28/2006
12/28/2006
$
22,875,000
$
18,250,000
$
8,540,000
$
9,275,000
$
31,415,000
$
27,525,000
$
57,000
$
2,000
$
2,691,000
$
241,000
$
34,163,000
$
27,768,000
II-27
Table of Contents
ACQUISITION OF PROPERTIES BY PROGRAMS
SPONSORED BY TRIPLE NET PROPERTIES, LLC (UNAUDITED)
Program:
Name, location, type of property
NNN Royal 400, LLC
Royal 400 Business Park
Alpharetta, GA
Office
140,000
12/29/2006
$
9,400,000
$
4,400,000
$
13,800,000
$
19,000
$
942,000
$
14,761,000
II-28
Table of Contents
By:
Title:
Chief Executive Officer, and
Chief Executive Officer and
Chairman of the Board
(principal executive officer)
President and Vice Chairman of the Board
Chief Financial Officer
(principal financial officer)
Director
Director
Director
Table of Contents
**
Previously filed
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
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19
20
21
22
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24
If to the Company:
|
TNP Strategic Retail Trust, Inc. | |
|
1900 Main Street, Suite 700 | |
|
Irvine, California 92614 | |
|
Facsimile: (949)-252-0212 | |
|
Attention: Wendy J. Worcaster | |
|
||
If to the Operating Partnership:
|
TNP Strategic Retail Operating Partnership, LP | |
|
c/o TNP Strategic Retail Trust, Inc., General Partner |
25
26
Accepted and agreed as of the date first above written: | ||||||
|
||||||
DEALER MANAGER | ||||||
|
||||||
TNP SECURITIES, LLC | ||||||
|
||||||
By:
|
/s/ Jack R. Maurer | |||||
|
Name: | Jack R. Maurer | ||||
|
Title: | President |
2
3
4
5
6
7
8
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10
11
12
DEALER MANAGER | ||||||||
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TNP SECURITIES, LLC | ||||||||
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By: | |||||||
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Name: | |||||||
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Title: |
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||||||
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Type of Entity:
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Organized in the State of:
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Tax Identification Number:
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FINRA/CRD Number:
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Company Name: | ||||
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Attention to: | ||||
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||||
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(Name) | |||
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||||
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||||
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(Title) | |||
Street Address: | ||||
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||||
City, State and Zip Code: | ||||
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||||
Telephone No.: ( ) | ||||
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||||
Facsimile No.: ( ) | ||||
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|
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|
||||
Email Address: | ||||
|
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Accepted and agreed as of the date below: | ||||||
|
||||||
PARTICIPATING DEALER | ||||||
|
||||||
(Print Name of Participating Dealer)
|
||||||
|
||||||
By:
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||||||
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||||||
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Name: | |||||
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|||||
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||||||
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Title: | |||||
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|||||
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||||||
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Date: | |||||
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NAME OF PARTICIPATING DEALER:
|
||||
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|||
SCHEDULE TO AGREEMENT DATED
:
|
||||
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DEALER MANAGER | ||||||||||
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||||||||||
TNP SECURITIES, LLC | ||||||||||
|
||||||||||
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By: | |||||||||
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||||||||||
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Name: | |||||||||
|
|
|||||||||
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Title: | |||||||||
|
|
PARTICIPATING DEALER | ||||||||
|
||||||||
(Print Name of Participating Dealer)
|
||||||||
|
||||||||
|
By: | |||||||
|
||||||||
|
Name: | |||||||
|
|
|||||||
|
Title: | |||||||
|
|
NAME OF PARTICIPATING DEALER:
|
||||
|
|
|||
SCHEDULE TO AGREEMENT DATED
:
|
||||
|
|
Bank Name:
|
||||
|
|
|||
|
||||
Bank Address:
|
||||
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|
|||
|
||||
Bank Routing Number: | ||||
|
|
|||
|
||||
Account Number: | ||||
|
|
PARTICIPATING DEALER | ||||||
|
||||||
(Print Name of Participating Dealer)
|
||||||
|
||||||
By:
|
||||||
|
||||||
|
Name: | |||||
|
|
|||||
|
||||||
|
Title: | |||||
|
|
|||||
|
||||||
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Date: | |||||
|
|
TO
PARTICIPATING DEALER AGREEMENT WITH
TNP SECURITIES, LLC
Alabama
o
Nebraska
Alaska
o
Nevada
Arizona
o
New Hampshire
Arkansas
o
New Jersey
California
o
New Mexico
Colorado
o
New York
Connecticut
o
North Carolina
Delaware
o
North Dakota
District of Columbia
o
Ohio
Florida
o
Oklahoma
Georgia
o
Oregon
Hawaii
o
Pennsylvania
Idaho
o
Puerto Rico
Illinois
o
Rhode Island
Indiana
o
South Carolina
Iowa
o
South Dakota
Kansas
o
Tennessee
Kentucky
o
Texas
Louisiana
o
Utah
Maine
o
Vermont
Maryland
o
Virgin Islands
Massachusetts
o
Virginia
Michigan
o
Washington
Minnesota
o
West Virginia
Mississippi
o
Wisconsin
Missouri
o
Wyoming
Montana
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
ATTEST:
|
TNP STRATEGIC RETAIL TRUST, INC. | |||||
|
||||||
/s/ Wendy J. Worcester
|
/s/ Jack R. Maurer (SEAL) | |||||
Name: Wendy J. Worcester
|
Name: Jack R. Maurer | |||||
Title: Secretary
|
Title: Vice Chairman of the Board and President |
41
|
Re: | Registration on Securities Form S-11 Relating to Shares of Common Stock of TNP Strategic Retail Trust, Inc. |
Very truly yours,
/s/ ALSTON & BIRD LLP |
||||
ESCROW AGREEMENT |
ES-003(07/09) | Page 1 of 12 |
ESCROW AGREEMENT |
ES-003 (07/09) | Page 2 of 12 |
ESCROW AGREEMENT |
ES-003 (07/09) | Page 3 of l2 |
ESCROW AGREEMENT |
ES-003 (07/09) | Page 4 of 12 |
ESCROW AGREEMENT |
ES-003 (07/09) | Page 5 of 12 |
ESCROW AGREEMENT |
ES-003 (07/09) | Page 6 of 12 |
ESCROW AGREEMENT |
ES-003 (07/09) | Page 7 of 12 |
ESCROW AGREEMENT |
ES-003 (07/09) | Page 8 of 12 |
ESCROW AGREEMENT |
ES-003 (07/09) | Page 9 of 12 |
ESCROW AGREEMENT |
ES-003 (07/09) | Page 10 of 12 |
ESCROW AGREEMENT |
TNP STRATEGIC RETAIL TRUST, INC., a Maryland Corporation |
||||
By: | /s/ Wendy J. Worcester | |||
Name: | Wendy J. Worcester | |||
Title: | Chief Financial Officer, Treasurer and Secretary | |||
TNP SECURITIES, LLC, a Delaware limited liability
company, as Dealer Manager |
||||
By: | /s/ Wendy J. Worcester | |||
Name: | Wendy J. Worcester | |||
Title: | Co-Chief Compliance Officer | |||
ES-003 (07/09) | Page 11 of 12 |
ESCROW AGREEMENT |
COMMERCEWEST BANK, N. A.,
as Escrow Agent |
||||
By: | /s/ Marshell Montgomery | |||
Name: | Marshell Montgomery | |||
Title: | Executive Vice President & Chief Administrative Officer | |||
ES-003 (07/09) | Page 12 of 12 |
Company
Representative: |
The following individual(s) is hereby appointed as representative of the Company under the Agreement: |
Name:
|
Specimen Signature: | |||||||
|
||||||||
|
||||||||
Name:
|
Specimen Signature: | |||||||
|
Dealer Manager
Representative: |
The following individual(s) is hereby appointed as representative of the Dealer Manager under the Agreement: |
Name:
|
Specimen Signature: | |||||||
|
||||||||
|
||||||||
Name:
|
Specimen Signature: | |||||||
|
ESCROW AGREEMENT |
ESCROW AGREEMENT |
1. |
Name of Subscriber
Address Tax Identification Number Amount of Securities subscribed for Amount of money paid and deposited with Escrow Agent |
|
2. |
Name of Subscriber
Address Tax Identification Number Amount of Securities subscribed for Amount of money paid and deposited with Escrow Agent |
Company:
|
||
|
||
By:
|
||
|
||
Its:
|
||
|
||
Date:
|
||
|
||
|
||
Dealer Manager:
|
||
|
||
By:
|
||
|
||
Its:
|
||
|
||
Date:
|
||
|
1.
|
Definitions | 1 | ||||
|
||||||
2.
|
Appointment | 8 | ||||
|
||||||
3.
|
Duties of the Advisor | 8 | ||||
|
||||||
4.
|
Authority of Advisor | 10 | ||||
|
||||||
5.
|
Bank Accounts | 10 | ||||
|
||||||
6.
|
Records; Access | 11 | ||||
|
||||||
7.
|
Limitations on Activities | 11 | ||||
|
||||||
8.
|
Relationship with Director | 11 | ||||
|
||||||
9.
|
Fees | 11 | ||||
|
||||||
10.
|
Expenses | 13 | ||||
|
||||||
11.
|
Other Services | 15 | ||||
|
||||||
12.
|
Reimbursement to the Advisor | 15 | ||||
|
||||||
13.
|
Business Combination | 15 | ||||
|
||||||
14.
|
Investment Opportunities | 16 | ||||
|
||||||
15.
|
The TNP Name | 16 | ||||
|
||||||
16.
|
Other Activities of the Advisor | 16 | ||||
|
||||||
17.
|
Term of Agreement | 17 | ||||
|
||||||
18.
|
Termination by the Parties | 17 | ||||
|
||||||
19.
|
Assignment to an Affiliate | 17 | ||||
|
||||||
20.
|
Payments to and duties of Advisor Upon Termination | 17 | ||||
|
||||||
21.
|
Indemnification by the Company and the Operating Partnership | 18 | ||||
|
||||||
22.
|
Indemnification by Advisor | 19 | ||||
|
||||||
23.
|
Notices | 19 | ||||
|
||||||
24.
|
Modification | 20 | ||||
|
||||||
25.
|
Severability | 20 | ||||
|
||||||
26.
|
Construction | 20 |
27.
|
Entire Agreement | 20 | ||||
|
||||||
28.
|
Indulgences, Not Waivers | 21 | ||||
|
||||||
29.
|
Gender | 21 | ||||
|
||||||
30.
|
Titles Not to Affect Interpretation | 21 | ||||
|
||||||
31.
|
Execution in Counterparts | 21 |
- 3 -
- 2 -
- 3 -
- 4 -
- 5 -
- 6 -
- 7 -
- 8 -
- 9 -
- 10 -
- 11 -
- 12 -
- 13 -
- 14 -
- 15 -
- 16 -
- 17 -
- 18 -
- 19 -
To the Directors and to the Company:
|
TNP Strategic Retail Trust, Inc. | |
|
1901 Main Street | |
|
Suite 108 | |
|
Irvine, California 92614 | |
|
Telephone: (949) 833-8252 | |
|
Facsimile: (949) 252-0212 | |
|
Attention: Jack R. Maurer, Vice Chairman of the Board and President | |
|
||
|
||
To the Operating Partnership:
|
TNP Strategic Retail Operating Partnership, LP | |
|
1901 Main Street | |
|
Suite 108 | |
|
Irvine, California 92614 | |
|
Telephone: (949) 833-8252 | |
|
Facsimile: (949) 252-0212 | |
|
Attention: Wendy J. Worcester | |
|
||
|
||
To the Advisor:
|
TNP Strategic Retail Advisor, LLC | |
|
1901 Main Street | |
|
Suite 108 | |
|
Irvine, California 92614 | |
|
Telephone: (949) 833-8252 | |
|
Facsimile: (949) 252-0212 | |
|
Attention: Jack R. Maurer, Vice Chairman of the Board and President | |
|
- 20 -
- 21 -
TNP Strategic Retail Trust, Inc. | ||||||
|
||||||
|
By: | /s/ Wendy J. Worcester | ||||
|
||||||
|
Name: | /s/ Wendy J. Worcester | ||||
|
||||||
|
Title: | Chief Financial Officer, Treasurer and Secretary | ||||
|
||||||
|
||||||
TNP Strategic Retail Operating Partnership, LP | ||||||
|
||||||
|
By: |
TNP Strategic Retail Trust, Inc.,
its General Partner |
||||
|
||||||
|
By: /s/ Wendy J. Worcester | |||||
|
|
|||||
|
Name: /s/ Wendy J. Worcester | |||||
|
|
|||||
|
Title: Chief Financial Officer, Treasurer and Secretary | |||||
|
|
|||||
|
||||||
TNP Strategic Retail Advisor, LLC | ||||||
|
||||||
|
By: |
Thompson National Properties, LLC,
its sole member |
||||
|
||||||
|
By: /s/ Anthony W. Thompson | |||||
|
|
|||||
|
Name: Anthony W. Thompson | |||||
|
|
|||||
|
Title: Chief Executive Officer | |||||
|
|
2009 INCENTIVE PLAN
ARTICLE 1
1
1.1
1
ARTICLE 2
1
2.1
1
ARTICLE 3
7
3.1
7
3.2
7
ARTICLE 4
8
4.1
8
4.2
8
4.3
8
4.4
9
ARTICLE 5
9
5.1
9
5.2
10
5.3
10
ARTICLE 6
11
6.1
11
ARTICLE 7
11
7.1
11
7.2
12
ARTICLE 8
12
8.1
12
ARTICLE 9
AND DEFERRED STOCK UNITS
13
9.1
13
9.2
13
9.3
13
9.4 |
Delivery of Restricted Stock
|
13 | ||||
ARTICLE 10 |
PERFORMANCE AWARDS
|
14 | ||||
10.1 |
Grant of Performance Awards
|
14 | ||||
10.2 |
Performance Goals
|
14 | ||||
ARTICLE 11 |
DIVIDEND EQUIVALENTS
|
14 | ||||
11.1 |
Grant of Dividend Equivalents
|
14 | ||||
ARTICLE 12 |
STOCK OR OTHER STOCK-BASED AWARDS
|
15 | ||||
12.1 |
Grant of Stock or Other Stock-Based Awards
|
15 | ||||
ARTICLE 13 |
PROVISIONS APPLICABLE TO AWARDS
|
15 | ||||
13.1 |
Term of Awards
|
15 | ||||
13.2 |
Form of Payment of Awards
|
15 | ||||
13.3 |
Limits on Transfer
|
15 | ||||
13.4 |
Beneficiaries
|
16 | ||||
13.5 |
Stock Trading Restrictions
|
16 | ||||
13.6 |
Acceleration upon Death or Disability
|
16 | ||||
13.7 |
Acceleration upon a Change in Control
|
17 | ||||
13.8 |
Acceleration for Any Reason
|
17 | ||||
13.9 |
Forfeiture Events
|
17 | ||||
13.10 |
Substitute Awards
|
18 | ||||
ARTICLE 14 |
CHANGES IN CAPITAL STRUCTURE
|
18 | ||||
14.1 |
Mandatory Adjustments
|
18 | ||||
14.2 |
Discretionary Adjustments
|
18 | ||||
14.3 |
General
|
19 | ||||
ARTICLE 15 |
AMENDMENT, MODIFICATION AND TERMINATION
|
19 | ||||
15.1 |
Amendment, Modification and Termination
|
19 | ||||
15.2 |
Awards Previously Granted
|
19 | ||||
15.3 |
Compliance Amendments
|
20 | ||||
ARTICLE 16 |
GENERAL PROVISIONS
|
20 | ||||
16.1 |
Rights of Participants
|
20 | ||||
16.2 |
Withholding
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21 | ||||
16.3 |
Special Provisions Related to Section 409A of the Code
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21 |
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16.4 |
Unfunded Status of Awards
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22 | ||||
16.5 |
Relationship to Other Benefits
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23 | ||||
16.6 |
Expenses
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23 | ||||
16.7 |
Titles and Headings
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23 | ||||
16.8 |
Gender and Number
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23 | ||||
16.9 |
Fractional Shares
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23 | ||||
16.10 |
Government and Other Regulations
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23 | ||||
16.11 |
Governing Law
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24 | ||||
16.12 |
Additional Provisions
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24 | ||||
16.13 |
No Limitations on Rights of Company
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24 | ||||
16.14 |
Indemnification
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24 |
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TNP STRATEGIC RETAIL TRUST, INC.
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/s/ Wendy J. Worcester | ||||||
By: | Wendy J. Worcester | |||||
Chief Financial Officer, Treasurer and Secretary |
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TNP STRATEGIC RETAIL TRUST, INC.
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/s/ Wendy J. Worcester | ||||
By: | Wendy J. Worcester | |||
Its: | Chief Financial Officer, Treasurer and Secretary | |||