SEC Comment Letter for MODIV INDUSTRIAL, INC. (MDV, MDV-PA) (CIK 0001645873) (MDV) — Mar 10, 2017
MODIV INDUSTRIAL, INC. (MDV, MDV-PA) (CIK 0001645873)
Date: March 10, 2017 · CIK: 0001645873 · Accession: 0000000000-17-008054
AI Filing Summary & Sentiment
Reasoning
File numbers found in text: 333-205684
Letter
Mail Stop 3233 March 10 , 2017 Via E -mail Jean Ho Chief Financial Officer Rich Uncles NNN REIT, Inc. 3080 Bristol Street, Suite 550 Costa Mesa, CA 92626
Re: Rich Uncles NNN REIT, Inc. Post-Effective Amendment to Form S-11 Filed February 16, 2017 File No. 333-205684
Dear Ms. Ho:
We have reviewed your post-effective amendment and have the following comments. In some of our comments, we may ask you to provide us with information so we may better understand your disclosure.
Please respond to this letter by amending your registration statement and providing the requested information . If you do not believe our comments apply to your facts and circumstances or do not believe an amendme nt is appropriate, please tell us why in your response.
After reviewing any amendment to your registration statement and the information you provide in response to these comments, we may have additional comments.
If I buy shares, will I receive distr ibutions and how often?, page 14
1. We note your response to prior comment 2 and revised d isclosure on page 14 . Please remove the annualized rate of returns and refrain from including such disclosure until you have paid distributions at a speci fic annualized rate for two or more quarters.
2. We note your revised disclosure in response to prior comment 3 that “to date, the sources of cash used to pay our stockholder distributions have been from net rental income received, and waivers and deferral s of Advisor Asset Management Fees.” We further note you r tabular disclosure on page 75 indicating that cash flow from operations during the relevant periods were insufficient to cover the distributions paid. Please revise your disclosures to clarify th e amount of distributions that were paid from waivers and deferrals of Advisor Asset Management Fees. Please also distinguish the portion of such fees that were waived versus deferred by your Advisor.
Jean Ho Rich Uncles NNN REIT, Inc. March 10, 2017 Page 2
Existing Properties and Investments, page 61
3. Pleas e revise this section to better differentiate between the information relating to your properties as opposed to the properties owned by Rich Uncles Real Estate Investment Trust I. Please also revise your disclosure on page 61 introducing the property -level data of Rich Uncles Real Estate Investment Trust I to clarify that you do not directly own these properties and that you own 4.34% of the outstanding common stock of Rich Uncles Real Estate Investment Trust I, which owns the properties.
4. We note that your lease expiration table on page 61 appears to be the lease expiration table for the properties owned by Rich Uncles Real Estate Investment Trust I. Please revise your disclosure to provide a lease expiration table for your prop erties and to remove the lease expiration table for properties owned by Rich Uncles Real Estate Investment Trust I.
5. We note your response to prior comment 6 and revised disclosure that “we have no present intention of increasing our ownership in the tru st.” Please revise your disclosure to state whether there is any limit on the amount you may invest in Rich Uncles Real Estate Investment Trust I. Please also expand upon your disclosure to explain your strategy as it relates to investments in securities of other entities .
Share Repurchase Program, page 113
Post-NAV Calculation, page 115
6. We note your response to prior comment 9, but note that the revised language on page 115 was added to the pre -NAV calculation section. Please revise to clarify, with respect to the post -NAV calculation procedures, the time frame within which you will disc lose a determination to repurchase fewer shares than have been requested to your current and prospective stockholders and by what means you will do so. Please also indicate whether such disclosure will remind shareholders with unsatisfied repurchase reque sts that their requests must be resubmitted at the start of the next month or quarter, as applicable.
We remind you that the company and its management are responsible for the accuracy and adequacy of their disclosures, notwithstanding any review, com ments, action or absence of action by the staff.
Jean Ho Rich Uncles NNN REIT, Inc. March 10, 2017 Page 3
Please contact Sandra Hunter, Staff Attorney, at (202) 551 -3758 or me at (202) 551 -3466 with any other questions.
Sincerely,
/s/ Coy Garrison
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Mail Stop 3233 March 10 , 2017 Via E -mail Jean Ho Chief Financial Officer Rich Uncles NNN REIT, Inc. 3080 Bristol Street, Suite 550 Costa Mesa, CA 92626 Re: Rich Uncles NNN REIT, Inc. Post-Effective Amendment to Form S-11 Filed February 16, 2017 File No. 333-205684 Dear Ms. Ho: We have reviewed your post-effective amendment and have the following comments. In some of our comments, we may ask you to provide us with information so we may better understand your disclosure. Please respond to this letter by amending your registration statement and providing the requested information . If you do not believe our comments apply to your facts and circumstances or do not believe an amendme nt is appropriate, please tell us why in your response. After reviewing any amendment to your registration statement and the information you provide in response to these comments, we may have additional comments. If I buy shares, will I receive distr ibutions and how often?, page 14 1. We note your response to prior comment 2 and revised d isclosure on page 14 . Please remove the annualized rate of returns and refrain from including such disclosure until you have paid distributions at a speci fic annualized rate for two or more quarters. 2. We note your revised disclosure in response to prior comment 3 that “to date, the sources of cash used to pay our stockholder distributions have been from net rental income received, and waivers and deferral s of Advisor Asset Management Fees.” We further note you r tabular disclosure on page 75 indicating that cash flow from operations during the relevant periods were insufficient to cover the distributions paid. Please revise your disclosures to clarify th e amount of distributions that were paid from waivers and deferrals of Advisor Asset Management Fees. Please also distinguish the portion of such fees that were waived versus deferred by your Advisor. Jean Ho Rich Uncles NNN REIT, Inc. March 10, 2017 Page 2 Existing Properties and Investments, page 61 3. Pleas e revise this section to better differentiate between the information relating to your properties as opposed to the properties owned by Rich Uncles Real Estate Investment Trust I. Please also revise your disclosure on page 61 introducing the property -level data of Rich Uncles Real Estate Investment Trust I to clarify that you do not directly own these properties and that you own 4.34% of the outstanding common stock of Rich Uncles Real Estate Investment Trust I, which owns the properties. 4. We note that your lease expiration table on page 61 appears to be the lease expiration table for the properties owned by Rich Uncles Real Estate Investment Trust I. Please revise your disclosure to provide a lease expiration table for your prop erties and to remove the lease expiration table for properties owned by Rich Uncles Real Estate Investment Trust I. 5. We note your response to prior comment 6 and revised disclosure that “we have no present intention of increasing our ownership in the tru st.” Please revise your disclosure to state whether there is any limit on the amount you may invest in Rich Uncles Real Estate Investment Trust I. Please also expand upon your disclosure to explain your strategy as it relates to investments in securities of other entities . Share Repurchase Program, page 113 Post-NAV Calculation, page 115 6. We note your response to prior comment 9, but note that the revised language on page 115 was added to the pre -NAV calculation section. Please revise to clarify, with respect to the post -NAV calculation procedures, the time frame within which you will disc lose a determination to repurchase fewer shares than have been requested to your current and prospective stockholders and by what means you will do so. Please also indicate whether such disclosure will remind shareholders with unsatisfied repurchase reque sts that their requests must be resubmitted at the start of the next month or quarter, as applicable. We remind you that the company and its management are responsible for the accuracy and adequacy of their disclosures, notwithstanding any review, com ments, action or absence of action by the staff. Jean Ho Rich Uncles NNN REIT, Inc. March 10, 2017 Page 3 Please contact Sandra Hunter, Staff Attorney, at (202) 551 -3758 or me at (202) 551 -3466 with any other questions. Sincerely, /s/ Coy Garrison Coy Garrison Special Counsel Office of Real Estate and Commodities cc: Gregory W. Preston, Esq. Corporate Law Solutions, P.C.