Fractional Dutch Auctions of Commercial Income-Producing Real Estate Properties - TIC Plan Ownership Syndications

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Due Diligence Documentation "Exhibit F-6"

Project Economic Key Milestone Goals

The following notes are provided pertaining to this exhibit:

  1. What: the proposed Project must have its potential for success (or failure) measured by some relative scale so that subscribers may have a basis for judging whether or not they are getting the benefits they should rightfully own.

  2. When: this document is created during the pre-construction phase just prior to the commencement of the actual syndication process.

  3. Why: there must be a "business deal" between the entity seeking capital investment and the investors who provide the capital investment in exchange for some future benefit.  This document states what those future economic benefits are anticipated to be and how they will be divided.  This protects the interests of the real estate syndication participants (that's people like you) by setting forth the minimum standards by which the Developer/Sponsor will be contractually bound to deliver.  If the Developer/Sponsor cannot or will not cause the distributions to be made, then the Developer/Sponsor is placed at risk for losing the entire Developer/Sponsor share of the transaction (among other remedies).

  4. Where: this applies to the proposed Project and the Syndicate and Developer maintain records of this schedule.

  5. How: the Developer/Sponsor prepares a schedule that reflects the minimum targets for paying distributions to the Syndicate (in the form of rental payments) over the course of the Project's lifetime (which is assumed to be no more than 10 years).

  6. What's important: this document serves as the "goal posts" for the business deal between the Developer/Sponsor entity that is sponsoring the syndication (on one side) and the Syndicate participants who purchase fractional ownership units (on the other side).  The goal posts are immutable for the lifetime of the transaction (i.e.: these goals will be binding until there comes a time when the Project is sold-off to another party and wound up, or operations cease because they are no longer profitable and the Project is sold-off).

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