Exhibit 99.2
 
 
NYSE: MDV
 
QUARTERLY SUPPLEMENTAL DATA
 


June 30, 2022
 

Modiv Inc.
Supplemental Information - Second Quarter 2022

Table of Contents
 
     
About the Data
3
     
Company Overview
4
     
Financial Results
 
 
Statements of Operations - Last Five Quarters
5
 
Earnings Per Share - Last Five Quarters
6
 
FFO and AFFO - Last Five Quarters
7
 
Adjusted EBITDA - Last Five Quarters
8
 
Leverage Ratio
9
Balance Sheets and Capitalization
 
 
Capitalization
10
 
Balance Sheets
11
 
Debt Overview
12
 
Credit Facility and Mortgage Notes Covenants
13
     
Real Estate
 
 
Acquisitions
14
 
Dispositions
15
 
Top 10 Tenants
16
 
Property Type
17
 
Industry Diversification
18
 
Geographic Diversification
19
 
Lease Expirations
20
     
Appendix
 
 
Disclosures Regarding Non-GAAP and Other Metrics
21

2

About the Data
 
This data and other information described herein are as of and for the three months ended June 30, 2022 unless otherwise indicated. Future performance may not be consistent with past performance and is subject to change and inherent risks and uncertainties. This information should be read in conjunction with Modiv Inc.'s Quarterly Report on Form 10-Q for the quarter ended June 30, 2022, including the financial statements and management's discussion and analysis of financial condition and results of operations.
 
Forward Looking Statements
 
Information set forth herein contains forward-looking statements, which reflect our current views regarding our business, financial performance, growth prospects and strategies, market opportunities, and market trends. Forward-looking statements include all statements that are not historical facts. In some cases, you can identify these forward-looking statements by the use of words such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “could,” “seeks,” “approximately,” “projects,” “predicts,” “intends,” “plans,” “estimates,” “anticipates,” or the negative version of these words or other comparable words. All of the forward-looking statements herein are subject to various risks and uncertainties. Assumptions relating to the foregoing involve judgments with respect to, among other things, future economic, competitive and market conditions, and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond our control. Although we believe that the expectations reflected in such forward-looking statements are based on reasonable assumptions, our actual results, performance, and achievements could differ materially from those expressed in or by the forward-looking statements and may be affected by a variety of risks and other factors. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from such forward-looking statements. These factors include, but are not limited to, risks and uncertainties related to the COVID-19 pandemic and its related impacts on us and our tenants, general economic conditions, including but not limited to impacts of the Russian war against Ukraine, supply-chain disruptions, increases in the rate of inflation and interest rates, local real estate conditions, tenant financial health, and property acquisitions and the timing of these acquisitions. These and other risks, assumptions, and uncertainties are described in our filings with the SEC, which are available on the SEC’s website at www.sec.gov. You are cautioned not to place undue reliance on any forward-looking statements included herein. All forward-looking statements are made as of the date of this document and the risk that actual results, performance, and achievements will differ materially from the expectations expressed or referenced herein will increase with the passage of time. We undertake no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments, or otherwise, except as required by law.

3

Company Overview
Modiv Inc. (NYSE:MDV) (“Modiv”, the “Company”, “we”, “us” and “our”) is an internally managed real estate investment trust (“REIT”) that acquires, owns and manages a diversified portfolio of predominantly single-tenant net-lease real estate properties. The Company primarily invests in industrial and retail properties that are mission critical to tenants. Driven by innovation and an investor-first focus, Modiv is committed to providing investors with Monthly Dividends and More Diversification. As of June 30, 2022, Modiv had a $540 million real estate portfolio (based on estimated fair value) comprised of 2.9 million square feet of aggregate leasable area. For more information, please visit: www.modiv.com.
 
Management Team:
 
Independent Directors:
     
Aaron S. Halfacre
 
Adam S. Markman
Chief Executive Officer and Director
 
Chairman of the Board
     
Raymond J. Pacini
 
Asma Ishaq
Chief Financial Officer and Secretary
   
     
Sandra G. Sciutto
 
Curtis B. McWilliams
Chief Accounting Officer
   
     
John C. Raney
 
Thomas H. Nolan, Jr.
Chief Legal Officer
   
     
William R. Broms
 
Kimberly Smith
Chief Investment Officer
   
     
David Collins
 
Connie Tirondola
Chief Property Officer
   
 
Investor Inquiries:
Megan McGrath, Financial Profiles, Inc.
Mmcgrath@finprofiles.com
310-622-8248
 
Transfer Agent:
Computershare Trust Company, N.A.
150 Royall Street
Canton, MA 02021
800-736-3001

4

Modiv Inc.
Condensed Consolidated Statements of Operations - Last Five Quarters
(Unaudited)
 
   
Three Months Ended
 
   
June 30,
2022
   
March 31,
2022
   
December 31,
2021
   
September 30,
2021
   
June 30,
2021
 
Rental income (a)
  $
10,394,118
   
$
9,648,649
   
$
7,899,149
   
$
10,241,690
   
$
9,107,008
 
                                         
Expenses:
                                       
General and administrative
   
1,615,182
     
2,106,183
     
2,186,563
     
2,930,578
     
2,108,782
 
Stock compensation
   
679,747
     
511,865
     
629,539
     
743,609
     
767,087
 
Depreciation and amortization
   
3,682,681
     
3,300,492
     
3,449,407
     
3,814,503
     
3,978,323
 
Interest expense
   
1,197,154
     
1,568,175
     
1,874,867
     
1,831,545
     
2,098,649
 
Property expenses (b)
   
1,965,885
     
2,764,592
     
1,580,629
     
1,658,437
     
1,697,886
 
Reversal of impairment of real estate investment property
   
     
     
     
     
(400,999
)
Impairment of goodwill and intangible assets (c)
   
     
17,320,857
     
3,767,190
     
     
 
Total expenses
   
9,140,649
     
27,572,164
     
13,488,195
     
10,978,672
     
10,249,728
 
                                         
Other operating income (loss):
                                       
Gain on sale of real estate investments
   
1,002,101
     
7,400,777
     
3,271,289
     
4,242,771
     
 
Operating income (loss)
   
2,255,570
     
(10,522,738
)
   
(2,317,757
)
   
3,505,789
     
(1,142,720
)
                                         
Other (expense) income:
                                       
Interest income
   
1,763
     
13,435
     
19,958
     
1,270
     
51
 
Income from investment in unconsolidated entity
   
66,868
     
95,464
     
53,337
     
75,403
     
74,834
 
Loss on early extinguishment of debt (d)
   
     
(1,725,318
)
   
     
     
 
Other (a)
   
66,143
     
65,993
     
65,993
     
65,993
     
65,992
 
Other (expense) income, net
   
134,774
     
(1,550,426
)
   
139,288
     
142,666
     
140,877
 
                                         
Net income (loss)
   
2,390,344
     
(12,073,164
)
   
(2,178,469
)
   
3,648,455
     
(1,001,843
)
Less: net income (loss) attributable to noncontrolling interest in Operating Partnership
   
219,214
     
(1,928,029
)
   
     
     
 
Net income (loss) attributable to Modiv Inc.
   
2,171,130
     
(10,145,135
)
   
(2,178,469
)
   
3,648,455
     
(1,001,843
)
Preferred stock dividends (e)
   
(921,875
)
   
(921,875
)
   
(921,875
)
   
(143,403
)
   
 
Net income (loss) attributable to common stockholders
 
$
1,249,255
   
$
(11,067,010
)
 
$
(3,100,344
)
 
$
3,505,052
   
$
(1,001,843
)
                                         
Earnings (loss) per share attributable to common stockholders
                                       
Basic
 
$
0.17
   
$
(1.47
)
 
$
(0.41
)
 
$
0.47
   
$
(0.13
)
Diluted
 
$
0.14
   
$
(1.47
)
 
$
(0.41
)
 
$
0.40
   
$
(0.13
)
                                         
Weighted-average number of common shares outstanding
                                       
Basic
   
7,478,973
     
7,533,158
     
7,531,167
     
7,531,559
     
7,614,196
 
Diluted (f)
   
10,221,490
     
7,533,158
     
7,531,167
     
8,750,875
     
7,614,196
 
                                         
Distributions declared per common share (g)
 
$
0.2875
   
$
0.3875
   
$
0.2875
   
$
0.2625
   
$
0.2625
 
 
(a)
Rental income includes tenant reimbursements for property expenses. During the three months ended June 30, 2021 and September 30, 2021, the Company reclassified $65,993 related to asset management fees earned on the Company's 72.71% tenant-in-common interest (“TIC Interest”) in an industrial property in Santa Clara, California to conform with the December 31, 2021 and later presentation.
(b)
Property expenses for the second quarter of 2022 include increased property and other taxes compared with the comparable quarter of 2021, primarily related to the growth of our portfolio. These expenses are largely offset by tenant reimbursements included in rental income. Property expenses for the first quarter of 2022 also include $587,000 in write-offs of costs related to our proposed acquisition of 10 properties leased to Walgreens which we abandoned due to inability to obtain the mortgage servicer's approval prior to the contract termination date of February 18, 2022 and changes in market conditions.
(c)
Goodwill, which relates to the 2019 acquisition of our former sponsor’s crowdfunding platform, was impaired in the first quarter of 2022 in accordance with GAAP given that the market value of the Company’s common stock is materially below our historical net asset value and the book value of our equity. The impairment of intangible assets in the fourth quarter of 2021 relates to the Company’s decision to terminate its crowdfunding operations.
(d)
Loss on early extinguishment of debt for the first quarter of 2022 includes non-recurring charges for (i) $1,164,998 in non-cash write-offs of deferred financing costs upon refinancing 20 mortgages and the prior credit facility with the KeyBank credit facility and mortgage repayments related to four asset sales; (ii) $615,336 of mortgage prepayment fees; and (iii) $733,000 of swap termination fees related to four of the mortgages refinanced with the KeyBank credit facility and the related write-off of unrealized valuation losses of $788,016.
(e)
On September 17, 2021, the Company sold 2,000,000 shares of its 7.375% Series A Cumulative Redeemable Perpetual Preferred Stock, $0.001 par value in an underwritten public offering at $25.00 per share.
(f)
Diluted shares outstanding in the second quarter of 2022 and the third quarter of 2021 include Class C, Class M, Class P and Class R OP Units since the Company reported net income for those quarters. Diluted shares outstanding for periods when the Company reported a net loss do not include the OP Units since they would be anti-dilutive.
(g)
The Company increased the annual distribution rate on its common stock from $1.05 per share to $1.15 per share effective October 1, 2021. Distributions declared during the first quarter of 2022 include a one-time 13th distribution for 2021 of $0.10 per share for stockholders of record on January 6, 2022.

5

Modiv Inc.
Earnings (Loss) Per Share - Last Five Quarters
(Unaudited)
 
   
Three Months Ended
 
   
June 30,
2022
   
March 31,
2022
   
December 31,
2021
   
September 30,
2021
   
June 30,
2021
 
Numerator - Basic:
                             
Net income (loss)
 
$
2,390,344
   
$
(12,073,164
)
 
$
(2,178,469
)
 
$
3,648,455
   
$
(1,001,843
)
Net (income) loss attributable to noncontrolling interest in Operating Partnership
   
(219,214
)
   
1,928,029
     
     
     
 
Preferred stock dividends
   
(921,875
)
   
(921,875
)
   
(921,875
)
   
(143,403
)
   
 
Net income (loss) attributable to common stockholders
 
$
1,249,255
   
$
(11,067,010
)
 
$
(3,100,344
)
 
$
3,505,052
   
$
(1,001,843
)
                                         
Numerator - Diluted:
                                       
Net income (loss)
 
$
2,390,344
   
$
(12,073,164
)
 
$
(2,178,469
)
 
$
3,648,455
   
$
(1,001,843
)
Less: preferred stock dividends
   
(921,875
)
   
(921,875
)
   
(921,875
)
   
(143,403
)
   
 
Net income (loss) attributable to common stockholders
 
$
1,468,469
   
$
(12,995,039
)
 
$
(3,100,344
)
 
$
3,505,052
   
$
(1,001,843
)
                                         
Denominator:
                                       
Weighted average shares outstanding - basic
   
7,478,973
     
7,533,158
     
7,531,167
     
7,531,559
     
7,614,196
 
Operating Partnership Units - Class C (a)
   
1,312,382
     
     
     
     
 
Operating Partnership Units - other (b)
   
1,430,135
     
     
     
1,219,316
     
 
Weighted average shares outstanding - diluted
   
10,221,490
     
7,533,158
     
7,531,167
     
8,750,875
     
7,614,196
 
                                         
Earnings (loss) per share attributable to common stockholders:
                                       
Basic
 
$
0.17
   
$
(1.47
)
 
$
(0.41
)
 
$
0.47
   
$
(0.13
)
Diluted
 
$
0.14
   
$
(1.47
)
 
$
(0.41
)
 
$
0.40
   
$
(0.13
)
 
(a)
The Company issued 1,312,382 Class C OP Units in connection with its January 18, 2022 acquisition of a KIA auto dealership property in an “UPREIT” transaction. These units were not included in the computation of Diluted EPS for the quarter ended March 31, 2022 because their effect would be anti-dilutive.
 
(b)
During the three months ended March 31, 2022, December 31, 2021 and June 30, 2021, the weighted average dilutive effect of 1,347,958, 1,213,173 and 1,219,789 shares, respectively, related to Operating Partnership units were excluded from the computation of Diluted EPS because their effect would be anti-dilutive. There were no other outstanding securities or commitments to issue common stock that would have a dilutive effect for the period then ended.

6

Modiv Inc.
FFO and AFFO - Last Five Quarters
(Unaudited)
 
   
Three Months Ended
 
   
June 30,
2022
   
March 31,
2022
   
December 31,
2021
   
September 30,
2021
   
June 30,
2021
 
Net income (loss) (in accordance with GAAP)
 
$
2,390,344
   
$
(12,073,164
)
 
$
(2,178,469
)
 
$
3,648,455
   
$
(1,001,843
)
Preferred stock dividends
   
(921,875
)
   
(921,875
)
   
(921,875
)
   
(143,403
)
   
 
Net income (loss) attributable to common stockholders and Class C OP Units
   
1,468,469
     
(12,995,039
)
   
(3,100,344
)
   
3,505,052
     
(1,001,843
)
FFO adjustments:
                                       
Add:   Depreciation and amortization
   
3,682,681
     
3,300,492
     
3,290,588
     
3,342,713
     
3,512,727
 
Amortization of lease incentives
   
75,655
     
71,394
     
53,203
     
86,694
     
40,240
 
Depreciation and amortization for unconsolidated investment in a real estate property
   
190,468
     
190,468
     
189,439
     
182,324
     
181,786
 
Less:  Gain on sale of real estate investments, net


(1,002,101
)


(7,400,777
)


(3,271,289
)


(4,242,771
)


 
Reversal of impairment of real estate investment properties
   
     
     
     
     
(400,999
)
FFO attributable to common stockholders and Class C OP Units
   
4,415,172
     
(16,833,462
)
   
(2,838,403
)
   
2,874,012
     
2,331,911
 
AFFO adjustments:
                                       
Add:   Amortization of corporate intangibles (a)
   
     
     
158,819
     
471,790
     
465,596
 
Impairment of goodwill and intangible assets (a)
   
     
17,320,857
     
3,767,190
     
     
 
Stock compensation (b)
   
679,747
     
511,865
     
629,542
     
743,609
     
767,087
 
Deferred financing costs (c)
   
101,781
     
1,266,725
     
162,200
     
7,393
     
100,624
 
Non-recurring loan prepayment penalties
   
     
615,336
     
     
     
 
Swap termination costs
   
     
733,000
     
     
     
 
Amortization of above-market lease intangibles
   
32,456
     
32,456
     
32,456
     
32,454
     
32,458
 
Acquisition fees and due diligence expenses, including abandoned pursuit costs (d)
   
4,639
     
586,669
     
(16,100
)
   
474,429
     
238,496
 
Less   Deferred rents
   
(699,053
)
   
(110,505
)
   
1,138,991
     
(247,716
)
   
(428,155
)
Unrealized gain on interest rate swaps
   
(589,997
)
   
(788,016
)
   
(285,982
)
   
(166,338
)
   
(90,600
)
Amortization of below-market lease intangibles
   
(349,810
)
   
(363,074
)
   
(363,074
)
   
(364,573
)
   
(367,575
)
Other adjustments for unconsolidated investment in a real estate property
   
(188
)
   
(188
)
   
(6,191
)
   
(12,195
)
   
(12,196
)
AFFO attributable to common stockholders and Class C OP Units
 
$
3,594,747
   
$
2,971,663
   
$
2,379,448
   
$
3,812,865
   
$
3,037,646
 
                                         
Weighted average shares outstanding
                                       
Basic
   
7,478,973
     
7,533,158
     
7,531,167
     
7,531,559
     
7,614,196
 
Fully diluted (e) (f)
   
10,221,490
     
10,193,498
     
8,744,340
     
8,750,875
     
8,833,985
 
FFO per share
                                       
Basic
 
$
0.59
   
$
(2.23
)
 
$
(0.38
)
 
$
0.38
   
$
0.31
 
Fully diluted
 
$
0.43
   
$
(2.23
)
 
$
(0.38
)
 
$
0.33
   
$
0.26
 
AFFO per share
                                       
Basic
 
$
0.48
   
$
0.39
   
$
0.32
   
$
0.51
   
$
0.40
 
Fully diluted
 
$
0.35
   
$
0.29
   
$
0.27
   
$
0.44
   
$
0.34
 

(a)
Intangible assets reflected the Company’s investment in its crowdfunding platform which was impaired in the fourth quarter of 2021 due to the Company’s decision to terminate its crowdfunding operations. Goodwill, which relates to the 2019 acquisition of our former sponsor’s crowdfunding platform, was impaired in the first quarter of 2022 in accordance with GAAP given that the market value of the Company’s common stock was materially below our historical net asset value and the book value of our equity.
(b)
Stock compensation expense includes (i) amortization of the Class P OP Units granted to the Company’s Chief Executive Officer and Chief Financial Officer on December 31, 2019; (ii) amortization of the Class R OP Units granted to all of the Company’s employees, including the Chief Executive Officer and Chief Financial Officer, on January 25, 2021; and (iii) stock granted to the Company’s independent directors each quarter as partial consideration for their service as directors.
(c)
Deferred financing costs for the first quarter of 2022 primarily reflect non-cash write-offs of such costs upon refinancing 20 mortgages with the KeyBank credit facility and mortgage repayments related to four asset sales.
(d)
Abandoned pursuit costs for the first quarter of 2022 primarily reflect the Company’s decision not to extend the February 18, 2022 termination date for its agreement to purchase a portfolio of 10 properties leased to Walgreens, which the Company abandoned due to inability to obtain the mortgage servicer's approval prior to the contract termination date and changes in market conditions.
(e)
The increase in Diluted shares outstanding beginning in the first quarter of 2022 primarily reflects the issuance of 1,312,382 Class C interests in our operating partnership (OP Units”) as partial consideration for the acquisition of a retail property located on Interstate 405 in Carson, CA, leased to a KIA auto dealership.
(f)
Includes the Class C, Class M, Class P and Class R OP Units to compute the weighted average number of shares for the quarter ended June 30, 2022 and the Class M, Class P and Class R OP Units to compute the weighted average number of shares for each prior quarter.

7

Modiv Inc.
Adjusted EBITDA - Last Five Quarters
(Unaudited)
 
   
Three Months Ended
 
   
June 30,
2022
   
March 31,
2022
   
December 31,
2021
   
September 30,
2021
   
June 30,
2021
 
Net income (loss)
 
$
2,390,344
   
$
(12,073,164
)
 
$
(2,178,469
)
 
$
3,648,455
   
$
(1,001,843
)
                                         
Add:   Depreciation and amortization
   
3,682,681
     
3,300,492
     
3,449,407
     
3,814,503
     
3,978,323
 
Depreciation and amortization for unconsolidated investment in a real estate property
   
190,468
     
190,468
     
189,439
     
182,324
     
181,786
 
Interest expense
   
1,197,155
     
1,568,175
     
1,874,867
     
1,831,545
     
2,098,649
 
Loss on early extinguishment of debt (a)
   
     
1,725,318
     
     
     
 
Interest expense on unconsolidated investment in real estate property
   
98,135
     
97,645
     
100,257
     
100,788
     
100,366
 
Reversal of impairment of real estate investment property
   
     
     
     
     
(400,999
)
Impairment of goodwill and intangible assets (b)
   
     
17,320,857
     
3,767,190
     
     
 
Stock compensation
   
679,747
     
511,865
     
629,542
     
743,609
     
767,087
 
Write-off of due diligence costs related to abandoned acquisition of 10 properties leased to Walgreens
   
     
587,000
     
     
     
 
Less:  Gain on sale of real estate investments
   
(1,002,101
)
   
(7,400,777
)
   
(3,271,289
)
   
(4,242,771
)
   
 
Adjusted EBITDA
 
$
7,236,429
   
$
5,827,879
   
$
4,560,944
   
$
6,078,453
   
$
5,723,369
 
                                         
Annualized adjusted EBITDA
  $
28,945,716
   
$
23,311,516
   
$
18,243,776
   
$
24,313,812
   
$
22,893,476
 
                                         
Net debt:
                                       
Debt
 
$
201,425,173
   
$
165,509,220
   
$
183,033,756
   
$
182,146,897
   
$
190,181,378
 
Debt of unconsolidated investment in real estate property (c)
   
9,599,182
     
9,653,689
     
9,709,710
     
9,764,171
     
9,817,066
 
Cash and restricted cash
   
(11,705,449
)
   
(25,344,063
)
   
(58,407,520
)
   
(54,710,887
)
   
(10,374,445
)
Cash of unconsolidated investment in real estate property (c)
   
(585,357
)
   
(458,948
)
   
(502,041
)
   
(487,490
)
   
(572,064
)
   
$
198,733,549
   
$
149,359,898
   
$
133,833,905
   
$
136,712,691
   
$
189,051,935
 
                                         
Net debt / Adjusted EBITDA
   
6.9
x
   
6.4
x
   
7.3
x
   
5.6
x
   
8.3
x
 
(a)
Loss on early extinguishment of debt includes non-recurring charges for (i) $1,164,998 in non-cash write-offs of deferred financing costs upon refinancing 20 mortgages and the prior credit facility with the KeyBank credit facility and mortgage repayments related to four asset sales; (ii) $615,336 of mortgage prepayment fees; and (iii) $733,000 of swap termination fees related to refinancing four mortgages with the KeyBank credit facility and the related write-off of unrealized valuation losses of $788,016.
(b)
Goodwill, which relates to the 2019 acquisition of our former sponsor’s crowdfunding platform, was impaired in the first quarter of 2022 in accordance with GAAP given that the market value of the Company’s common stock is materially below our historical net asset value and the book value of our equity. The impairment of intangible assets in the fourth quarter of 2021 relates to the Company’s decision to terminate its crowdfunding operations.
(c)
Includes the Company's 72.71% pro rata share of the tenant-in-common's mortgage note payable and cash.

8

Modiv Inc.
Leverage ratio
(Unaudited)
 
In connection with entering into the KeyBank credit facility on January 18, 2022, the Company modified the calculation of its leverage ratio to conform with the definition in the KeyBank credit facility as set forth below.
 
   
June 30,
2022
   
December 31, 2021 (d)
 
Total Asset Value
           
Cash and cash equivalents (a)
 
$
11,705,449
   
$
58,407,520
 
Borrowing base value (b)
   
388,766,886
     
362,497,305
 
Other real estate value (c)
   
122,076,864
     
130,670,000
 
Pro-rata share of unconsolidated investment
   
28,811,379
     
28,728,063
 
Total asset value
 
$
551,360,578
   
$
580,302,888
 
                 
Indebtedness
               
Credit facility revolver (a)
 
$
6,775,000
   
$
55,775,000
 
Credit facility term loan
   
150,000,000
     
100,000,000
 
Mortgage debt (c)
   
44,650,173
     
66,833,439
 
Pro-rata share of unconsolidated investment
   
9,599,182
     
9,709,710
 
Total indebtedness
 
$
211,024,355
   
$
232,318,149
 
 
               
Leverage Ratio
   
38
%
   
40
%
 
(a)
The decrease in cash and cash equivalents primarily reflects the use of cash for the Lindsay property portfolio acquisition in April 2022.
 
(b)
The increase in the borrowing base value reflects the addition of four industrial properties acquired in April 2022 which are leased to Lindsay and the addition of the one industrial property acquired in January 2022 and leased to Kalera, Inc., partially offset by the one office property sold in June 2022.
 
(c)
The decrease in other real estate value and mortgage debt reflects the four property dispositions in February 2022, partially offset by the addition of four industrial properties leased to Lindsay which will not be added to the borrowing base value until completion of a reverse 1031 exchange.
 
(d)
The December borrowing base value reflects a pro forma adjustment to include acquisition of the KIA auto dealership property on January 18, 2022 and the credit facility amounts reflect pro forma adjustments to reflect debt balances as of the January 18, 2022 closing of the facility, including borrowing to fund a portion of the KIA auto dealership property acquisition.
 
9

Modiv Inc.
Capitalization as of June 30, 2022
(Unaudited)
 
PREFERRED EQUITY
     
7.375% Series A Cumulative Redeemable Perpetual Preferred Stock
 
$
50,000,000
 
% of Total Capitalization
   
12
%
         
COMMON EQUITY
       
Shares of Class C Common Stock
   
7,456,562
 
OP Units (Class M, Class P, Class R and Class C)
   
2,831,356
 
Total Class C Common Stock and OP Units
   
10,287,918
 
Price Per Share / Unit at June 30, 2022
 
$
17.68
 
IMPLIED EQUITY MARKET CAPITALIZATION
 
$
181,890,390
 
% of Total Capitalization
   
42
%
         
DEBT
       
Mortgage Debt
       
Costco Property
 
$
18,850,000
 
Taylor Fresh Foods Property
   
12,350,000
 
Sutter Health Property
   
13,450,173
 
Total Mortgage Debt
 
$
44,650,173
 
KeyBank Credit Facility
       
Revolver (a)
 
$
6,775,000
 
Term Loan (a)
   
150,000,000
 
Total Credit Facility
 
$
156,775,000
 
TOTAL DEBT
 
$
201,425,173
 
% of Total Capitalization
   
46
%
% of Total Debt - Floating Rate Debt (b)
   
3
%
% of Total Debt - Fixed Rate Debt (b)
   
97
%
% of Total Debt
   
100
%
ENTERPRISE VALUE
       
Total Capitalization
 
$
433,315,563
 
Less: Cash and Cash Equivalents
   
(11,705,449
)
Enterprise Value
 
$
421,610,114
 
 
(a)
In April 2022, the Company borrowed $44,000,000 to fund the acquisition of an eight-property portfolio of industrial properties leased to Lindsay Precast, LLC (the “Lindsay Acquisition”), drew the remaining $50,000,000 available under the Term loan commitment and reduced the Revolver to $14,775,000 in connection with the swap purchase described below. In June 2022, the Company made an $8,000,000 principal payment on the Revolver with available cash on hand to reduce interest expense.
(b)
On May 10, 2022, we purchased a five-year swap at 2.258% on our $150,000,000 term loan that results in a fixed interest rate of 3.858% when our leverage ratio is less than or equal to 40%. As part of this transaction, we sold a one-time option to terminate the swap on December 31, 2024, which reduced the swap rate. Under our Credit Agreement, the interest rate will continue to vary based on our leverage ratio.

10

Modiv Inc.
Condensed Consolidated Balance Sheets

(Unaudited)
 
   
June 30,
2022
   
December 31, 2021
 
Assets
           
Real estate investments:
           
Land
 
$
107,569,641
   
$
61,005,402
 
Buildings and improvements
   
327,472,940
     
250,723,446
 
Tenant origination and absorption costs
   
21,384,224
     
22,027,054
 
Equipment
   
4,429,000
     
 
Total investments in real estate property
   
460,855,805
     
333,755,902
 
Accumulated depreciation and amortization
   
(43,728,520
)
   
(37,611,133
)
Total investments in real estate property, net
   
417,127,285
     
296,144,769
 
Unconsolidated investment in a real estate property
   
9,956,518
     
9,941,338
 
Total real estate investments, net
   
427,083,803
     
306,086,107
 
Real estate investments held for sale, net
   
     
31,510,762
 
Total real estate investments
   
427,083,803
     
337,596,869
 
Cash and cash equivalents
   
11,705,449
     
55,965,550
 
Restricted cash
   
     
2,441,970
 
Receivable from sale of early termination of lease
   
1,446,767
     
1,836,767
 
Tenant receivables
   
8,059,634
     
5,996,919
 
Above-market lease intangibles, net
   
626,107
     
691,019
 
Prepaid expenses and other assets
   
6,766,867
     
5,856,255
 
Interest rate swap derivative
   
589,997
     
 
Assets related to real estate investments held for sale
   
     
788,296
 
Goodwill
   
     
17,320,857
 
Total assets
 
$
456,278,624
   
$
428,494,502
 
Liabilities and Equity
               
Mortgage notes payable, net
 
$
44,608,815
   
$
152,223,579
 
Mortgage notes payable related to real estate investments held for sale, net
   
     
21,699,912
 
Total mortgage notes payable, net
   
44,608,815
     
173,923,491
 
Credit facility revolver
   
6,775,000
     
8,022,000
 
Credit facility term loan, net
   
148,850,050
     
 
Accounts payable, accrued and other liabilities
   
8,733,757
     
11,844,881
 
Below-market lease intangibles, net
   
10,175,284
     
11,102,940
 
Interest rate swap derivatives
   
     
788,016
 
Liabilities related to real estate investments held for sale
   
     
383,282
 
Total liabilities
   
219,142,906
     
206,064,610
 
                 
Commitments and contingencies
               
                 
7.375% Series A cumulative redeemable perpetual preferred stock, $0.001 par value, 2,000,000 shares authorized, issued and outstanding as of June 30, 2022 and December 31, 2021
   
2,000
     
2,000
 
Class C common stock $0.001 par value, 300,000,000 shares authorized, 7,643,992 shares issued and 7,456,562 shares outstanding as of June 30, 2022, respectively, and 7,426,636 shares issued and outstanding as of December 31, 2021
   
7,644
     
7,427
 
Class S common stock $0.001 par value, 100,000,000 shares authorized, no and 63,768 shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively
   
     
64
 
Additional paid-in-capital
   
275,922,227
     
273,441,831
 
Treasury stock, at costs, 187,430 shares and no shares as of June 30, 2022 and December 31, 2021, respectively
   
(3,253,902
)
   
 
Cumulative distributions and net losses
   
(116,491,382
)
   
(101,624,430
)
Total Modiv Inc. equity
   
156,186,587
     
171,826,892
 
Noncontrolling interests in the Operating Partnership
   
80,949,131
     
50,603,000
 
Total equity
   
237,135,718
     
222,429,892
 
Total liabilities and equity
 
$
456,278,624
   
$
428,494,502
 

11

Modiv Inc.
Debt Overview
(Unaudited)
 
   
Outstanding Balance
                   
Collateral
 
June 30, 2022
   
December 31,
2021
   
Contractual Interest
Rate
   
Effective
Interest Rate
   
Loan
Maturity
 
Mortgage Notes:
                             
Costco property
 
$
18,850,000
   
$
18,850,000
     
4.85
%
   
4.85
%
 
1/1/30
 
Taylor Fresh Foods property
   
12,350,000
     
12,350,000
     
3.85
%
   
3.85
%
 
11/1/29
 
Sutter Health property
   
13,450,173
     
13,597,120
     
4.50
%
   
4.50
%
 
3/9/24
 
Various mortgage notes repaid on January 18, 2022 (a)
   
     
108,178,317
   
Various
   
Various
   
Various
 
     
44,650,173
     
152,975,437
                       
Plus unamortized mortgage premium
   
171,810
     
204,281
                       
Less unamortized deferred financing costs
   
(213,168
)
   
(956,139
)
                     
Mortgage notes payable, net
   
44,608,815
     
152,223,579
                       
                                       
KeyBank Credit Facility:
                                     
Revolver (a)
   
6,775,000
     
   
(b)
   
(b)
   
1/18/26
 
Term loan (a)
   
150,000,000
     
   
(c)
   
(c)
   
1/18/27
 
Bank of California Credit Facility (a)
   
     
8,022,000
   
(d)
   
(d)
     
n/a
 
Total Credit Facility
   
156,775,000
     
8,022,000
                         
Less unamortized deferred financing costs
   
(1,149,950
)
   
(100,080
)
                       
     
155,625,050
     
7,921,920
                         
Total debt, net
 
$
200,233,865
   
$
160,145,499
                         
 
(a)
On January 18, 2022, the Company refinanced 20 mortgage notes and its prior credit facility with the KeyBank Credit Facility. In April 2022, the Company borrowed $44,000,000 to fund the Lindsay Acquisition, drew the remaining $50,000,000 available under the Term loan commitment and reduced the Revolver to $14,775,000 in preparation for the swap agreement described below.  In June 2022, the Company made an $8,000,000 principal payment on the Revolver with available cash on hand to reduce interest expense.
 
(b)
The interest rate on the Revolver is based on the Company's leverage ratio at the end of the prior quarter. With our leverage ratio at 34% as of March 31, 2022, the spread over the Secured Overnight Financing Rate (‘‘SOFR’’), including a 10 basis point credit adjustment, is 165 basis points and the interest rate on the Revolver was 3.150% as of June 30, 2022. Our leverage ratio as of June 30, 2022 was 38% and following the Federal Reserve Bank’s July 27, 2022 increase in the target range for federal funds by 75 basis points, the interest rate on the Revolver is approximately 3.96%. We also pay an annual unused fee of up to 25 basis points on the Revolver, depending on the daily amount of the unused commitment.
 
(c)
On May 10, 2022, we purchased a five-year swap at 2.258% on the $150,000,000 term loan that results in a fixed interest rate of 3.858% when our leverage ratio is less than or equal to 40%. As part of this transaction, we agreed to a one-time option to terminate the swap on December 31, 2024, which reduced the swap rate. Under our Credit Facility, the interest rate will continue to vary based on our leverage ratio.
 
(d)
Under the terms of the prior credit facility with Bank of California, the Company paid a variable rate of interest on outstanding amounts equal to one percentage point over the prime rate published in The Wall Street Journal, provided that the interest rate in effect on any one day was not less than 4.75% per annum.
 
12

Modiv Inc.
Covenants
 
Credit Facility and Mortgage Notes Covenants
 
The following is a summary of key financial covenants for the Company’s credit facility and mortgage notes, as defined and calculated per the terms of the facility's credit agreement and the mortgage notes' governing documents, respectively, which are included in the Company's filings with the U.S. Securities and Exchange Commission. These calculations, which are not based on U.S. GAAP measurements are presented to demonstrate that as of June 30, 2022, the Company believes it is in compliance with the covenants.
 
Unsecured Credit Facility Covenants
 
Required
   
June 30, 2022
 
Maximum leverage ratio
 
<60%
   
38%

Minimum fixed charge coverage ratio
 
>1.50x
   
1.82
 
Maximum secured indebtedness ratio
 
40%

 
8%

Minimum consolidated tangible net worth
 
$
209,795,448
   
$
280,864,238
 
Minimum investment grade tenants in borrowing base
 
30%

 
52%


Mortgage Notes Key Covenants
 
Debt service
coverage ratio
   
June 30, 2022
 
Costco property
 
N.A.
   
N.A.
 
Taylor Fresh Foods property
 
1.5
   
3.4
 
Sutter Health property
 
1.4
   
2.4
 

13

Modiv Inc.
Real Estate Acquisitions
(Unaudited)
 
The following table summarizes the Company’s property acquisition activity during each of last five quarters ended June 30, 2022.
 
Q2 2022(a)

                                     
Tenant and Location
 
Property
Type
 
Area
(Square
Feet)
   
Lease
Terms (Years)
   
Annual Rent
Increase
   
Acquisition
Price
   
Initial
Cap Rate
   
Weighted
Average
Cap Rate
 
Lindsay Precast, eight properties acquired in Colorado (3), Ohio (2), North Carolina, South Carolina and Florida
 
Industrial
   
618,195
     
25.0
     
2.0
%
 
$
56,150,000
     
6.65
%
   
8.52
%

Q1 2022
                                       
Tenant and Location
 
Property Type
 
Area (Square
Feet)
   
Lease Terms
(Years)
   
Annual Rent
Increase
   
Acquisition
Price
   
Initial Cap
Rate
   
Weighted
Average Cap
Rate
 
KIA, Carson, CA
 
Retail
   
72,623
     
25.0
     
2.0
%
 
$
69,275,000
     
5.7
%
   
7.3
%
Kalera, Saint Paul, MN
 
Industrial
   
78,857
     
20.0
     
2.5
%
   
8,079,000
     
7.0
%
   
8.9
%
           
151,480
     
22.5
     
2.3
%
 
$
77,354,000
     
6.4
%
   
8.1
%

Q4 2021
                                       
Tenant and Location
 
Property
Type
 
Area (Square
Feet)
   
Lease
Terms
(Years)
   
Annual
Rent
Increase
   
Acquisition
Price
   
Initial Cap
Rate
   
Weighted
Average
Cap Rate
 
Arrow Tru-Line, Archbold, OH
 
Industrial
   
206,155
     
20.0
     
2.0
%
 
$
11,460,000
     
6.7
%
   
8.1
%

Q3 2021
                                       
Tenant and Location
 
Property Type
 
Area (Square Feet)
   
Lease Terms (Years)
   
Annual Rent Increase
   
Acquisition Price
   
Initial Cap Rate
   
Weighted Average Cap Rate
 
Raising Cane’s, San Antonio, TX
 
Retail
   
3,853
     
6.6
     
2.0
%
 
$
3,607,424
     
6.3
%
   
7.1
%

Q2 2021
                     
Tenant and Location
 
Property
Type
Area (Square
Feet)
Lease
Terms
(Years)
Annual
Rent
Increase
Acquisition
Price
Initial Cap
Rate
Weighted
Average
Cap Rate
None
                     

(a)
On July, 15, 2022, the Company acquired two industrial properties leased to New Vision Industries, LLC and Juniper Ring Acquisitions, LLC (the "Producto Acquisition") for $5,343,862 which represents an initial cap rate of 7.21% and a weighted average cap rate of 8.76%. The properties are located in Upstate New York. On July 26 and August 4, 2022, the Company acquired four industrial properties leased to Valtir, LLC for $23,375,000 which represents an initial cap rate of 7.70% and a weighted average cap rate of 9.73%. The properties are located in South Carolina, Ohio, Texas and Utah.

14

Modiv Inc.
Real Estate Dispositions
(Unaudited)
 
The following table summarizes the Company’s property disposition activity during each of last five quarters ended June 30, 2022.
 
Q2 2022
                                             
Tenant and Location
 
Property
Type
 
Area (Square
Feet)
   
Acquisition
Price
   
Disposition
Price
   
Net Book
Value
   
Disposition
Costs
   
Gain on Sale
   
Cap Rate
 
EMCOR, Cincinnati, OH
 
Office
   
39,385
   
$
6,138,538
   
$
6,525,000
   
$
5,343,541
   
$
179,358
   
$
1,002,101
     
7.8
%

Q1 2022
                                             
Tenant and Location
 
Property Type
 
Area (Square Feet)
   
Acquisition Price
   
Disposition Price
   
Net Book Value
   
Disposition Costs
   
Gain on Sale
   
Cap Rate
 
Bon Secours, Richmond, VA
 
Office
 
$
72,890
   
$
10,842,907
   
$
10,200,000
   
$
9,768,252
   
$
252,344
   
$
179,404
     
8.1
%
Omnicare, Richmond, VA
 
Industrial
   
51,800
     
7,324,370
     
8,760,000
     
6,478,621
     
218,489
     
2,062,890
     
6.8
%
Texas Health, Dallas TX
 
Office
   
38,794
     
7,689,924
     
7,040,000
     
6,711,271
     
168,352
     
160,377
     
7.9
%
Accredo, Orlando, FL
 
Office
   
63,000
     
10,710,500
     
14,000,000
     
8,552,619
     
449,275
     
4,998,106
     
7.3
%
          
$
226,484
   
$
36,567,701
   
$
40,000,000
   
$
31,510,763
   
$
1,088,460
   
$
7,400,777
     
7.5
%

Q4 2021
                                             
Tenant and Location
 
Property Type
 
Area (Square Feet)
   
Acquisition Price
   
Disposition Price
   
Net Book Value
   
Disposition Costs
   
Gain on Sale
   
Cap Rate
 
Harley Davidson, Bedford, TX
 
Retail
 
$
70,960
   
$
13,178,286
   
$
15,270,000
   
$
11,608,682
   
$
390,029
   
$
3,271,289
     
6.2
%

Q3 2021
                                                           
Tenant and Location
 
Property Type
 
Area(Square Feet)
   
Acquisition Price
   
Disposition Price
   
Net Book Value
   
Disposition Costs
   
Gain on Sale
   
Cap Rate
 
Dana. Cedar Park, TX
 
Industrial
 
$
45,465
   
$
9,452,169
   
$
10,000,000
   
$
5,375,746
   
$
381,483
   
$
4,242,771
     
7.7
%

Q2 2021
                                                           
Tenant and Location
 
Property Type
 
Area (Square Feet)
   
Acquisition Price
   
Disposition Price
   
Net Book Value
   
Disposition Costs
   
Gain on Sale
   
Cap Rate
 
None
                                                           

15

Modiv Inc.
Top 10 Tenants
(Unaudited)
 
Tenant (a)
 
Industry
 
ABR
   
ABR as a
Percentage of
Total Portfolio
   
Area
(Square Feet)
   
Square Feet
as a
Percentage of
Total Portfolio
 
KIA of Carson
 
Retail
 
$
3,946,792
     
11
%
   
72,623
     
3
%
Lindsay
 
Industrial
   
3,746,588
     
11
%
   
618,195
     
21
%
Sutter Health
 
Office
   
2,609,779
     
7
%
   
106,592
     
4
%
Costco Wholesale
 
Office
   
2,326,509
     
7
%
   
97,191
     
3
%
AvAir
 
Industrial
   
2,295,839
     
7
%
   
162,714
     
6
%
3M

Industrial
   
1,792,764
     
5
%
   
410,400
     
14
%
Taylor Farm
 
Industrial
   
1,626,728
     
5
%
   
216,727
     
7
%
FUJIFILM Dimatix (b)
 
Industrial
   
1,606,903
     
5
%
   
91,740
     
3
%
Cummins
 
Office
   
1,485,386
     
4
%
   
87,230
     
3
%
Northrop Grumman
 
Office
   
1,262,084
     
4
%
   
107,419
     
4
%
Total Top 10 Tenants
     
$
22,699,372
     
66
%
   
1,970,831
     
68
%
 
(a)
Following the Valtir Acquisition in July and August 2022, Valtir, LLC’s ABR of $1,800,000 represents approximately  5% of our total ABR.
 
(b)
Reflects our 72.71% tenant-in-common interest (“TIC Interest”).
 
Modiv Inc.
Property Type
(Unaudited)
 
Property
 
Number of
Properties
   
ABR
   
ABR as 
a Percentage of
Total Portfolio (a)
   
Area
(Square Feet)
   
Square Feet as
a Percentage
of Total
Portfolio
 
Industrial (b)
 
20
   
$
16,217,803
     
48
%
   
2,068,388
     
72
%
Retail
 
13
     
6,528,883
     
19
%
   
234,029
     
8
%
Office
 
10
     
11,398,322
     
33
%
   
585,967
     
20
%
Total Properties
 
43
   
$
34,145,008
     
100
%
   
2,888,384
     
100
%
 
(a)
Following the Company's July 2022 acquisitions of six industrial properties and a pending office disposition in August 2022, we own 26 industrial properties representing 51% of the portfolio, 13 retail properties representing 19% of the portfolio and 10 office properties representing 30% of the portfolio (based on pro forma ABR of $35,649,730 as of June 30, 2022).
 
(b)
Including TIC Interest.

16

Modiv Inc.
Tenant Industry Diversification (a)
(Unaudited)
 
Industry
 
Number of Properties
   
ABR
   
ABR as a
Percentage of
Total
Portfolio
   
Area
(Square Feet)
   
Square Feet
as a
Percentage of Total
Portfolio
 
Manufacturing
   
11
   
$
6,889,787
     
20
%
   
888,987
     
31
%
Automobile & Components
   
2
     
4,259,878
     
12
%
   
235,853
     
8
%
General Retailers
   
11
     
3,751,085
     
11
%
   
190,254
     
7
%
Health Care Equipment & Services
   
1
     
2,609,779
     
8
%
   
106,592
     
4
%
Transportation
   
1
     
2,295,839
     
7
%
   
162,714
     
6
%
Food, Beverage & Tobacco
   
2
     
2,198,150
     
6
%
   
295,584
     
10
%
Technology Hardware & Equipment
   
2
     
2,085,401
     
6
%
   
130,240
     
4
%
Defense
   
2
     
2,032,163
     
6
%
   
153,633
     
5
%
Materials
   
1
     
1,792,764
     
5
%
   
410,400
     
14
%
Commercial & Professional Services
   
2
     
1,542,100
     
5
%
   
70,567
     
2
%
Pharmaceuticals, Biotechnology & Life Sciences
   
1
     
1,179,234
     
3
%
   
20,800
      1
%
Consumer Durables and Apparel
   
2
     
1,088,051
     
3
%
   
75,977
     
3
%
Consumer Services
   
1
     
924,000
     
3
%
   
91,390
      3
%
Hotel & Restaurant
   
2
     
639,559
     
2
%
   
18,343
     
1
%
Energy
   
1
     
534,500
     
2
%
   
26,036
     
1
%
Government    
1
     
322,719
     
1
%
   
11,014
     
%
Total
   
43
   
$
34,145,009
     
100
%
   
2,888,384
     
100
%
 
(a)
Data as of June 30, 2022, which does not reflect the Producto and Valtir acquisitions which closed in July and August 2022.

17

Modiv Inc.
Tenant Geographic Diversification (a)
(Unaudited)
 
State
 
Number of
Properties
 
ABR
 
ABR as a
Percentage of
Total Portfolio
 
Area (Square
Feet)
 
Square Feet
as a
Percentage of
Total Portfolio
 
California
 
13
 
$
13,045,207
   
38
%
 
600,395
   
21
%
Arizona
 
2
   
3,922,567
    12
%
 
379,441
   
13
%
Florida
 
3
   
2,657,272
   
8
%
 
237,329
   
8
%
Ohio
 
6
   
2,474,694
   
7
%
 
510,343
   
18
%
Washington
 
1
   
2,326,510
   
7
%
 
97,191
   
3
%
Illinois
 
1
   
1,792,764
   
5
%
 
410,400
   
14
%
Nevada
 
2
   
1,626,251
   
5
%
 
77,257
   
3
%
Tennessee
 
1
   
1,485,386
   
4
%
 
87,230
   
3
%
North Carolina
 
2
   
1,354,120
   
4
%
 
134,576