Correspondence 0001628280-24-039682 from Principal Credit Real Estate Income Trust (CIK 0002026448)
Principal Credit Real Estate Income Trust (CIK 0002026448)
Date: Sept. 6, 2024 · CIK: 0002026448 · Accession: 0001628280-24-039682
AI Filing Summary & Sentiment
File numbers found in text: 000-56670
Referenced dates: April 26, 2017, August 22, 2024, December 21, 2016, September 1, 2017, September 12, 2016, September 20, 2017
Letter
VIA EDGAR U.S. Securities and Exchange Commission Division of Corporation Finance 100 F Street, N.E. Washington, D.C. 20549
Dear Ladies and Gentlemen:
On behalf of Principal Credit Real Estate Income Trust (the “Company”), we hereby transmit via EDGAR to the staff (the “Staff”) of the Division of Corporation Finance of the U.S. Securities and Exchange Commission (the “Commission”) Pre-Effective Amendment No. 1 (“Amendment No. 1”) to the above-referenced Registration Statement on Form 10-12G (the “Registration Statement”). The Company has prepared Amendment No. 1 to respond to the Staff’s comments in its letter dated August 22, 2024, relating to the Registration Statement (the “Comment Letter”) and to otherwise update its disclosure.
In addition, we are providing the following responses to the Comment Letter. To assist your review, we have retyped the text of the Staff’s comments in italics below. Page references in the text of this letter correspond to the pages of Amendment No. 1. Unless otherwise defined below, terms defined in Amendment No. 1 and used below shall have the meanings given to them in Amendment No. 1. The responses and information described below are based upon information provided to us by the Company.
Registration Statement on Form 10-12G
Item 1. Business, page 6
1.Please revise the diagram on page 17 to clarify who you intend to refer to by the phrase "investors in this offering" and whether these are the holders of the Classes S, T, D and I common shares that you are registering.
The Company has revised the diagram on page 17 of Amendment No. 1 to revise the intended reference of the phrase as "Investors in our Private Offering" to be holders of certain classes of the Company's common shares.
Simpson Thacher & Bartlett LLP
Securities and Exchange Commission -2-
September 6, 2024
Borrowing Policies, page 12
2.Please clarify if true there is no limit on the maximum amount of indebtedness you may incur with respect to your senior mortgages or on a portfolio-wide basis.
The Company confirms that there is no limit to how much it may borrow with respect to any individual investment or on a portfolio-wide basis. However, the Company respectfully notes that, as disclosed on Pages 12-13, it will target between a 65% to 75% leverage ratio on senior mortgages, which it expects will result in a portfolio-wide leverage ratio of 50% to 75%, and the Company’s board of trustees will periodically review its aggregate borrowings. In addition, the Company has revised its disclosure on Pages 13 and 83 to clarify that there is no limit on the amount of indebtedness it may incur.
Financing Arrangements, page 13
3.Please revise your discussion in this section to further explain your match funding strategy, including how you will match assets with liabilities with respect to interest rates as well as maturity.
The Company has revised the disclosure on Pages 13-14 to further explain our match funding strategy as matching the term of the financing arrangement to the expected term of the applicable CRE Debt investments.
Item 1. Business
(c) Description of Business
Advisory Agreement
Management Fee, Performance Fee and Expense Reimbursements, page 19
4.We note that your calculation of the performance fee attributable to shareholders of Class S, T, D, and I shares, is based on the company's measure titled Core earnings. We further note this measure is to include adjustments for various unrealized gains (losses), as well as one-time events pursuant to changes in U.S. GAAP, and certain non-cash adjustments and certain material non-cash income or expense items after discussions between the Adviser and the your independent trustees, subject to the approval of the majority of such trustees. Please tell us whether you intend to use this measure in future filings in any other capacity, including but not limited to, whether you plan to present this as a non-GAAP financial measure subject to Item 10(e) of Regulation S-K.
The Company respectfully notes that, while its financial reporting will include information with respect to the amount of performance fees paid by the Company to the Adviser, it does not presently intend to report or otherwise publicly disclose Core Earnings as a non-GAAP financial measure. Therefore, Regulation G and/or Item 10(e) does not apply. To the extent the Company determines to disclose Core Earnings in subsequent filings, the Company will provide the disclosures required by Regulation G and/or Item 10(e) of Regulation S-K, as applicable.
Anchor Investment and Repurchase Terms, page 22
5.Disclosure in the second paragraph that Anchor Investors may request the repurchase of Class A shares equal to the amount available under your share repurchase plan's 5% quarterly cap appears to conflict with disclosure immediately following that the Class A shares are not subject to the quarterly limitation. Please revise to clarify. Please also clarify whether Class A shares
Simpson Thacher & Bartlett LLP
Securities and Exchange Commission -3-
September 6, 2024
could be repurchased up to the 5% cap if the company, in its discretion, determines to repurchase fewer shares in any calendar quarter than have been requested to be repurchased as described on page 25.
The Company respectfully notes that the subscription agreement between the Company and each Anchor Investor is the contractual agreement that governs the repurchase terms applicable to such Anchor Investor. Accordingly, the Class A shares issued in respect of the Anchor Investment are not eligible for repurchase pursuant to the Company’s share repurchase plan adopted by the Company’s board of trustees (the “Repurchase Plan”). However, the aggregate amount of Class A shares that may be repurchased by the Company from Anchor Investors during any calendar quarter is determined by reference to repurchases by other shareholders pursuant to the Repurchase Plan. Specifically, as disclosed on Page 23, following the Anchor Investor Liquidity Date, the amount of Class A shares that may be repurchased by the Company from Anchor Investors during any calendar quarter is limited to the amount available (i.e., below the 5% quarterly cap) under the Repurchase Plan during such quarter, after the Company satisfies requests from all other common shareholders who have properly submitted a repurchase request for such quarter in accordance with the Repurchase Plan. In addition, for so long as Principal Real Estate or its affiliates act as the investment adviser to the Company, the Company will not affect any Anchor Investor Repurchase in any quarter where the total number of all common shares requested to be repurchased by shareholders other than the Anchor Investors and their respective affiliates under the Repurchase Plan are not repurchased or the Repurchase Plan has been suspended.
For example, following the Anchor Investor Liquidity Date, if during a calendar quarter all other shareholders requested repurchases under the Repurchase Plan in an amount equal to 3% of the Company’s NAV, then the amount of Class A shares that the Company could repurchase from Anchor Investors during such quarter would be limited to 2% of the Company’s NAV (i.e., 5%, minus 3%, results in 2% availability for Anchor Investors during such calendar quarter).
Distribution Reinvestment Plan, page 24
6.Please be advised that you are responsible for analyzing the applicability of the tender offer rules, including Rule 13e-4 and Regulation 14E, to your share repurchase plan. We urge you to consider all the elements of your share repurchase plan in determining whether the program is consistent with relief granted by the Division of Corporation Finance in prior no action letters. To the extent you are relying on Blackstone Real Estate Income Trust, Inc. (Letter dated September 12, 2016), Rich Uncles NNN REIT, Inc. (Letter dated December 21, 2016), Hines Global REIT II, Inc. (Letter dated April 26, 2017), or Black Creek Diversified Property Fund Inc. (Letter dated September 1, 2017), please provide us with an analysis as to how your program is consistent with such relief. To the extent you have questions as to whether the program is entirely consistent with the relief previously granted by the Division of Corporation Finance, you may contact the Division’s Office of Mergers and Acquisitions at 202-551-3440.
The Company acknowledges that it is responsible for analyzing the applicability of the tender offer rules, including Rule 13e-4 and Regulation 14E, to the Repurchase Plan. The Company believes the Repurchase Plan is consistent with the relief granted by the Division of Corporation Finance. By way of illustration, below is a table setting forth the key features underlying the relief granted in Blackstone Real Estate Income Trust, Inc. (SEC No-Action Letter dated September 12, 2016) (“BREIT”) and Griffin Capital Essential Asset REIT II, Inc. (SEC No-Action Letter dated September 20, 2017) (“Griffin”). As shown below, the Company’s Repurchase Plan contains substantially each of these key features.
Simpson Thacher & Bartlett LLP
Securities and Exchange Commission -4-
September 6, 2024
Key Features of the Repurchase Plan BREIT Griffin The Company
•All material information relating to the Repurchase Plan will be fully and timely disclosed to all shareholders. The terms of the Repurchase Plan will be fully disclosed in the Offering Memorandum and the most recently determined NAV per share for each class of the Company’s common shares will always be available on the Company’s website and toll-free information line.1
√ √ √
•The Company will not solicit repurchases under the Repurchase Plan other than through the Offering Memorandum and supplements thereto disclosing the transaction price and NAV per share of each class of the Company’s common shares. Shareholders desiring to request repurchase of all or a portion of their shares will do so of their own volition and not at the behest, invitation or encouragement of the Company. The role of the Company in effectuating repurchases under the Repurchase Plan will be ministerial.
√ √ √
1 We note that each of Griffin and BREIT conducted continuous public offerings of common stock that were registered under the Securities Act, and, accordingly, disclosed the terms of its respective programs in a prospectus or supplement thereto, while the Company is conducting a continuous private offering of its common shares exempt from registration under the Securities Act. Therefore, the Company will provide substantially the same disclosure in its Offering Memorandum. We do not believe the registered or private nature of the offering is determinative, as the condition relates to the disclosure of the program terms to investors in the disclosure document provided to such investor at the time the investor makes an investment decision. See also, e.g., Broadstone Net Lease Inc. (relying on existing no-action letter relief in connection with its repurchase program, while conducting a continuous private offering of its common stock).
Simpson Thacher & Bartlett LLP
Securities and Exchange Commission -5-
September 6, 2024
•Shares will be repurchased quarterly under the Repurchase Plan at a price which will generally be equal to the NAV per share for the applicable class of shares for the prior month, and also provide each month the transaction price and the NAV per share for each class of shares on the Company’s website and toll-free information line. Subject to the terms of the Repurchase Plan, the Company will repurchase shares at the transaction price per share for the applicable class of the Company’s common shares.2
√ √ √
•Repurchases will be made on a quarterly basis. The repurchase price normally will be paid in cash within three business days following the last calendar day of the applicable quarter and will be the same for all shares of the same class repurchased in a given quarter.3
√ √ √
•Repurchases under the Repurchase Plan will be limited in any calendar quarter to shares whose aggregate value (based on the repurchase price per share for the quarter the repurchase is effected) is 5% of the combined NAV of all classes of the Company’s common shares as of the last calendar day of the immediately preceding month of the applicable quarter.4
√ √ √
2 While BREIT’s program provided for the repurchase of shares on a monthly basis, the Repurchase Plan is consistent with Griffin in this respect, which provided for quarterly repurchases. We also note that, while each of BREIT and Griffin undertook to file prospectus supplements with the SEC with such frequency as is required by the Securities Act, disclosing the historical NAV per share of each class of shares, the Company intends to file a Form 8-K under the Exchange Act, or otherwise disclose to all shareholders each quarter the applicable repurchase price. For each calendar quarter, the Company intends to set the Repurchase Deadline as a date that is no less than 10 business days following the date on which the repurchase price for such quarter is disclosed to investors, both of which, the applicable repurchase price and the Repurchase Deadline for such quarter, is expected to be included in a Form 8-K filed by the Company or otherwise disclosed to all shareholders. Consistent with the BREIT program, in the unlikely case that the repurchase price for the applicable quarter is not made available by the tenth business day prior to the last business day of such quarter (or is changed after such date), then no repurchase requests will be accepted for such quarter and shareholders who wish to have their shares repurchased the following quarter must resubmit their repurchase requests.
3 See supra note 2.
4 As a result of monthly repurchases, the BREIT program provided for a 2% limitation in any given calendar month and a 5% limitation for any calendar quarter, while the Griffin relief provided for a limitation of 5% of the aggregate NAV of the outstanding shares of all classes of shares as of the last calendar day of the previous calendar quarter. The Company believes basing the 5% quarterly limitation on the average aggregate NAV as of the end of the immediately preceding three months is more appropriate, as it provides for a current record of the Company’s NAV.
Simpson Thacher & Bartlett LLP
Securities and Exchange Commission -6-
September 6, 2024
•If the quarterly volume limitation is reached in any given quarter or the Company determines to repurchase fewer shares than have been requested to be repurchased in any particular quarter, repurchases under the Repurchase Plan for such quarter will be made on a pro rata basis.5
√ √ √
•Shareholders may withdraw any repurchase request by notifying the Company’s transfer agent on the Company’s toll-free information line before 4:00 p.m. Eastern time on the last business day of the applicable quarter.6
√ √ √7
•Material modifications, including any reduction to the quarterly limitations on repurchases, and suspensions of the Repurchase Plan will be promptly disclosed in a supplement to the Offering Memorandum, or periodic report filed by the Company, as well as on the Company’s website.8
√ √ √
•There will be no established regular trading market for the Company’s common shares. The Repurchase Plan will be terminated if the Company’s shares are listed on a national securities exchange or included for quotation in a national securities market, or in the event a secondary market for the Company’s shares develops.
√ √ √
•The Repurcha
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CORRESP 1 filename1.htm Document Simpson Thacher & Bartlett LLP 425 LEXINGTON AVENUE NEW YORK, NY 10017-3954 TELEPHONE: +1-212-455-2000 FACSIMILE: +1-212-455-2502 September 6, 2024 VIA EDGAR Re: Principal Credit Real Estate Income Trust Registration Statement on Form 10-12G Filed July 26, 2024 File No. 000-56670 Ms. Pearlyne Paulemon U.S. Securities and Exchange Commission Division of Corporation Finance 100 F Street, N.E. Washington, D.C. 20549 Dear Ladies and Gentlemen: On behalf of Principal Credit Real Estate Income Trust (the “Company”), we hereby transmit via EDGAR to the staff (the “Staff”) of the Division of Corporation Finance of the U.S. Securities and Exchange Commission (the “Commission”) Pre-Effective Amendment No. 1 (“Amendment No. 1”) to the above-referenced Registration Statement on Form 10-12G (the “Registration Statement”). The Company has prepared Amendment No. 1 to respond to the Staff’s comments in its letter dated August 22, 2024, relating to the Registration Statement (the “Comment Letter”) and to otherwise update its disclosure. In addition, we are providing the following responses to the Comment Letter. To assist your review, we have retyped the text of the Staff’s comments in italics below. Page references in the text of this letter correspond to the pages of Amendment No. 1. Unless otherwise defined below, terms defined in Amendment No. 1 and used below shall have the meanings given to them in Amendment No. 1. The responses and information described below are based upon information provided to us by the Company. Registration Statement on Form 10-12G Item 1. Business, page 6 1.Please revise the diagram on page 17 to clarify who you intend to refer to by the phrase "investors in this offering" and whether these are the holders of the Classes S, T, D and I common shares that you are registering. The Company has revised the diagram on page 17 of Amendment No. 1 to revise the intended reference of the phrase as "Investors in our Private Offering" to be holders of certain classes of the Company's common shares. Simpson Thacher & Bartlett LLP Securities and Exchange Commission -2- September 6, 2024 Borrowing Policies, page 12 2.Please clarify if true there is no limit on the maximum amount of indebtedness you may incur with respect to your senior mortgages or on a portfolio-wide basis. The Company confirms that there is no limit to how much it may borrow with respect to any individual investment or on a portfolio-wide basis. However, the Company respectfully notes that, as disclosed on Pages 12-13, it will target between a 65% to 75% leverage ratio on senior mortgages, which it expects will result in a portfolio-wide leverage ratio of 50% to 75%, and the Company’s board of trustees will periodically review its aggregate borrowings. In addition, the Company has revised its disclosure on Pages 13 and 83 to clarify that there is no limit on the amount of indebtedness it may incur. Financing Arrangements, page 13 3.Please revise your discussion in this section to further explain your match funding strategy, including how you will match assets with liabilities with respect to interest rates as well as maturity. The Company has revised the disclosure on Pages 13-14 to further explain our match funding strategy as matching the term of the financing arrangement to the expected term of the applicable CRE Debt investments. Item 1. Business (c) Description of Business Advisory Agreement Management Fee, Performance Fee and Expense Reimbursements, page 19 4.We note that your calculation of the performance fee attributable to shareholders of Class S, T, D, and I shares, is based on the company's measure titled Core earnings. We further note this measure is to include adjustments for various unrealized gains (losses), as well as one-time events pursuant to changes in U.S. GAAP, and certain non-cash adjustments and certain material non-cash income or expense items after discussions between the Adviser and the your independent trustees, subject to the approval of the majority of such trustees. Please tell us whether you intend to use this measure in future filings in any other capacity, including but not limited to, whether you plan to present this as a non-GAAP financial measure subject to Item 10(e) of Regulation S-K. The Company respectfully notes that, while its financial reporting will include information with respect to the amount of performance fees paid by the Company to the Adviser, it does not presently intend to report or otherwise publicly disclose Core Earnings as a non-GAAP financial measure. Therefore, Regulation G and/or Item 10(e) does not apply. To the extent the Company determines to disclose Core Earnings in subsequent filings, the Company will provide the disclosures required by Regulation G and/or Item 10(e) of Regulation S-K, as applicable. Anchor Investment and Repurchase Terms, page 22 5.Disclosure in the second paragraph that Anchor Investors may request the repurchase of Class A shares equal to the amount available under your share repurchase plan's 5% quarterly cap appears to conflict with disclosure immediately following that the Class A shares are not subject to the quarterly limitation. Please revise to clarify. Please also clarify whether Class A shares Simpson Thacher & Bartlett LLP Securities and Exchange Commission -3- September 6, 2024 could be repurchased up to the 5% cap if the company, in its discretion, determines to repurchase fewer shares in any calendar quarter than have been requested to be repurchased as described on page 25. The Company respectfully notes that the subscription agreement between the Company and each Anchor Investor is the contractual agreement that governs the repurchase terms applicable to such Anchor Investor. Accordingly, the Class A shares issued in respect of the Anchor Investment are not eligible for repurchase pursuant to the Company’s share repurchase plan adopted by the Company’s board of trustees (the “Repurchase Plan”). However, the aggregate amount of Class A shares that may be repurchased by the Company from Anchor Investors during any calendar quarter is determined by reference to repurchases by other shareholders pursuant to the Repurchase Plan. Specifically, as disclosed on Page 23, following the Anchor Investor Liquidity Date, the amount of Class A shares that may be repurchased by the Company from Anchor Investors during any calendar quarter is limited to the amount available (i.e., below the 5% quarterly cap) under the Repurchase Plan during such quarter, after the Company satisfies requests from all other common shareholders who have properly submitted a repurchase request for such quarter in accordance with the Repurchase Plan. In addition, for so long as Principal Real Estate or its affiliates act as the investment adviser to the Company, the Company will not affect any Anchor Investor Repurchase in any quarter where the total number of all common shares requested to be repurchased by shareholders other than the Anchor Investors and their respective affiliates under the Repurchase Plan are not repurchased or the Repurchase Plan has been suspended. For example, following the Anchor Investor Liquidity Date, if during a calendar quarter all other shareholders requested repurchases under the Repurchase Plan in an amount equal to 3% of the Company’s NAV, then the amount of Class A shares that the Company could repurchase from Anchor Investors during such quarter would be limited to 2% of the Company’s NAV (i.e., 5%, minus 3%, results in 2% availability for Anchor Investors during such calendar quarter). Distribution Reinvestment Plan, page 24 6.Please be advised that you are responsible for analyzing the applicability of the tender offer rules, including Rule 13e-4 and Regulation 14E, to your share repurchase plan. We urge you to consider all the elements of your share repurchase plan in determining whether the program is consistent with relief granted by the Division of Corporation Finance in prior no action letters. To the extent you are relying on Blackstone Real Estate Income Trust, Inc. (Letter dated September 12, 2016), Rich Uncles NNN REIT, Inc. (Letter dated December 21, 2016), Hines Global REIT II, Inc. (Letter dated April 26, 2017), or Black Creek Diversified Property Fund Inc. (Letter dated September 1, 2017), please provide us with an analysis as to how your program is consistent with such relief. To the extent you have questions as to whether the program is entirely consistent with the relief previously granted by the Division of Corporation Finance, you may contact the Division’s Office of Mergers and Acquisitions at 202-551-3440. The Company acknowledges that it is responsible for analyzing the applicability of the tender offer rules, including Rule 13e-4 and Regulation 14E, to the Repurchase Plan. The Company believes the Repurchase Plan is consistent with the relief granted by the Division of Corporation Finance. By way of illustration, below is a table setting forth the key features underlying the relief granted in Blackstone Real Estate Income Trust, Inc. (SEC No-Action Letter dated September 12, 2016) (“BREIT”) and Griffin Capital Essential Asset REIT II, Inc. (SEC No-Action Letter dated September 20, 2017) (“Griffin”). As shown below, the Company’s Repurchase Plan contains substantially each of these key features. Simpson Thacher & Bartlett LLP Securities and Exchange Commission -4- September 6, 2024 Key Features of the Repurchase Plan BREIT Griffin The Company •All material information relating to the Repurchase Plan will be fully and timely disclosed to all shareholders. The terms of the Repurchase Plan will be fully disclosed in the Offering Memorandum and the most recently determined NAV per share for each class of the Company’s common shares will always be available on the Company’s website and toll-free information line.1 √ √ √ •The Company will not solicit repurchases under the Repurchase Plan other than through the Offering Memorandum and supplements thereto disclosing the transaction price and NAV per share of each class of the Company’s common shares. Shareholders desiring to request repurchase of all or a portion of their shares will do so of their own volition and not at the behest, invitation or encouragement of the Company. The role of the Company in effectuating repurchases under the Repurchase Plan will be ministerial. √ √ √ 1 We note that each of Griffin and BREIT conducted continuous public offerings of common stock that were registered under the Securities Act, and, accordingly, disclosed the terms of its respective programs in a prospectus or supplement thereto, while the Company is conducting a continuous private offering of its common shares exempt from registration under the Securities Act. Therefore, the Company will provide substantially the same disclosure in its Offering Memorandum. We do not believe the registered or private nature of the offering is determinative, as the condition relates to the disclosure of the program terms to investors in the disclosure document provided to such investor at the time the investor makes an investment decision. See also, e.g., Broadstone Net Lease Inc. (relying on existing no-action letter relief in connection with its repurchase program, while conducting a continuous private offering of its common stock). Simpson Thacher & Bartlett LLP Securities and Exchange Commission -5- September 6, 2024 •Shares will be repurchased quarterly under the Repurchase Plan at a price which will generally be equal to the NAV per share for the applicable class of shares for the prior month, and also provide each month the transaction price and the NAV per share for each class of shares on the Company’s website and toll-free information line. Subject to the terms of the Repurchase Plan, the Company will repurchase shares at the transaction price per share for the applicable class of the Company’s common shares.2 √ √ √ •Repurchases will be made on a quarterly basis. The repurchase price normally will be paid in cash within three business days following the last calendar day of the applicable quarter and will be the same for all shares of the same class repurchased in a given quarter.3 √ √ √ •Repurchases under the Repurchase Plan will be limited in any calendar quarter to shares whose aggregate value (based on the repurchase price per share for the quarter the repurchase is effected) is 5% of the combined NAV of all classes of the Company’s common shares as of the last calendar day of the immediately preceding month of the applicable quarter.4 √ √ √ 2 While BREIT’s program provided for the repurchase of shares on a monthly basis, the Repurchase Plan is consistent with Griffin in this respect, which provided for quarterly repurchases. We also note that, while each of BREIT and Griffin undertook to file prospectus supplements with the SEC with such frequency as is required by the Securities Act, disclosing the historical NAV per share of each class of shares, the Company intends to file a Form 8-K under the Exchange Act, or otherwise disclose to all shareholders each quarter the applicable repurchase price. For each calendar quarter, the Company intends to set the Repurchase Deadline as a date that is no less than 10 business days following the date on which the repurchase price for such quarter is disclosed to investors, both of which, the applicable repurchase price and the Repurchase Deadline for such quarter, is expected to be included in a Form 8-K filed by the Company or otherwise disclosed to all shareholders. Consistent with the BREIT program, in the unlikely case that the repurchase price for the applicable quarter is not made available by the tenth business day prior to the last business day of such quarter (or is changed after such date), then no repurchase requests will be accepted for such quarter and shareholders who wish to have their shares repurchased the following quarter must resubmit their repurchase requests. 3 See supra note 2. 4 As a result of monthly repurchases, the BREIT program provided for a 2% limitation in any given calendar month and a 5% limitation for any calendar quarter, while the Griffin relief provided for a limitation of 5% of the aggregate NAV of the outstanding shares of all classes of shares as of the last calendar day of the previous calendar quarter. The Company believes basing the 5% quarterly limitation on the average aggregate NAV as of the end of the immediately preceding three months is more appropriate, as it provides for a current record of the Company’s NAV. Simpson Thacher & Bartlett LLP Securities and Exchange Commission -6- September 6, 2024 •If the quarterly volume limitation is reached in any given quarter or the Company determines to repurchase fewer shares than have been requested to be repurchased in any particular quarter, repurchases under the Repurchase Plan for such quarter will be made on a pro rata basis.5 √ √ √ •Shareholders may withdraw any repurchase request by notifying the Company’s transfer agent on the Company’s toll-free information line before 4:00 p.m. Eastern time on the last business day of the applicable quarter.6 √ √ √7 •Material modifications, including any reduction to the quarterly limitations on repurchases, and suspensions of the Repurchase Plan will be promptly disclosed in a supplement to the Offering Memorandum, or periodic report filed by the Company, as well as on the Company’s website.8 √ √ √ •There will be no established regular trading market for the Company’s common shares. The Repurchase Plan will be terminated if the Company’s shares are listed on a national securities exchange or included for quotation in a national securities market, or in the event a secondary market for the Company’s shares develops. √ √ √ •The Repurcha