Inland Residential Properties Trust 10-Q 13 Aug 15 2015 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2015	Aug. 10, 2015
Document And Entity Information
Entity Registrant Name	Inland Residential Properties Trust, Inc.
Entity Central Index Key	1,595,627
Document Type	10-Q
Document Period End Date	Jun. 30, 2015
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		8,000
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2,015

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($)	Jun. 30, 2015	Dec. 31, 2014
ASSETS
Cash and cash equivalents	$ 118,185	$ 232,635
Deferred offering costs		2,614,621
Other assets	$ 76,871	19,867
Total assets	195,056	2,867,123
Liabilities:
Accounts payable	390,458	1,319,477
Due to affiliates	3,658,038	1,532,667
Total liabilities	$ 4,048,496	$ 2,852,144
Commitments and contingencies
Stockholder's (deficit) equity:
Preferred stock, $.001 par value, 50,000,000 shares authorized, none outstanding
Common stock		$ 8
Additional paid in capital (net of offering costs of $3,603,221 and $0 as of June 30, 2015 and December 31, 2014, respectively)	$ (3,403,229)	199,992
Retained earnings (deficit)	(450,219)	(185,021)
Total stockholder's (deficit) equity	(3,853,440)	14,979
Total liabilities and stockholder's (deficit) equity	195,056	$ 2,867,123
Class A Common Stock [Member]
Stockholder's (deficit) equity:
Common stock	$ 8
Class T Common Stock [Member]
Stockholder's (deficit) equity:
Common stock

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parentheticals) - USD ($)	Jun. 30, 2015	Dec. 31, 2014
Preferred stock, par value	$ .001	$ .001
Preferred stock, shares authorized	50,000,000	50,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	$ .001	$ .001
Common stock, shares authorized	400,000,000	400,000,000
Common stock, shares issued	8,000	8,000
Common stock, shares outstanding	8,000	8,000
Offering costs included as reduction to additional paid in capital	$ 3,603,221
Class A Common Stock [Member]
Common stock, par value	$ .001	$ .001
Common stock, shares authorized	320,000,000	320,000,000
Common stock, shares issued	8,000	8,000
Common stock, shares outstanding	8,000	8,000
Class T Common Stock [Member]
Common stock, par value	$ .001	$ .001
Common stock, shares authorized	80,000,000	80,000,000
Common stock, shares issued	0	0
Common stock, shares outstanding	0	0

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Expenses:
General and administrative expenses	$ 111,807		$ 247,132
Organization costs		$ 1,875	18,066	$ 5,783
Net loss	$ (111,807)	$ (1,875)	$ (265,198)	$ (5,783)
Net loss per common share, basic and diluted	$ (13.98)	$ (0.23)	$ (33.15)	$ (0.72)
Weighted average number of common shares outstanding, basic and diluted	8,000	8,000	8,000	8,000

CONSOLIDATED STATEMENT OF EQUIT

CONSOLIDATED STATEMENT OF EQUITY (DEFICIT) - 6 months ended Jun. 30, 2015 - USD ($)	Common Stock [Member]	Additional Paid in Capital [Member]	Retained Earnings (Deficit) [Member]	Total
Balance at Dec. 31, 2014	$ 8	$ 199,992	$ (185,021)	$ 14,979
Balance, shares at Dec. 31, 2014	8,000			8,000
Offering costs		$ (3,603,221)		$ (3,603,221)
Net loss			$ (265,198)	(265,198)
Balance at Jun. 30, 2015	$ 8	$ (3,403,229)	$ (450,219)	$ (3,853,440)
Balance, shares at Jun. 30, 2015	8,000			8,000

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014
Cash flows from operating activities:
Net loss	$ (265,198)	$ (5,783)
Changes in assets and liabilities:
Accounts payable	(32,936)	(28,590)
Due to affiliates	(6,791)	$ 34,344
Other assets	(66,079)
Net cash flows used in operating activities	(371,004)	$ (29)
Cash flows from financing activities:
Payment of offering costs	(1,943,446)
Advances from sponsor	2,200,000
Net cash flows provided by financing activities	256,554
Net decrease in cash and cash equivalents	(114,450)	$ (29)
Cash and cash equivalents at beginning of the period	232,635	500,000
Cash and cash equivalents, at end of period	118,185	499,971
Supplemental disclosure of noncash financing activities:
Accrued offering expenses	$ (954,848)	$ (256,787)

Organization

Organization	6 Months Ended
	Jun. 30, 2015
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization	(1) Organization Inland Residential Properties Trust, Inc. was formed on December 19, 2013 to acquire and manage a portfolio of multifamily properties located primarily in the top 100 United States metropolitan statistical areas, which generally contain populations greater than 500,000 people. Effective July 14, 2014, the Company changed its name from “Inland Retail Properties Trust V, Inc.” to “Inland Residential Properties Trust, Inc.” Inland Real Estate Investment Corporation (the “Sponsor”) is the sole stockholder of the Company. The Company entered into a Business Management Agreement (the “Business Management Agreement”) with Inland Residential Business Manager & Advisor, Inc. (the “Business Manager”), an affiliate of the Company, to be the Business Manager to the Company. The Company is authorized to sell up to $1,000,000,000 of shares of common stock which consists of Class A common stock, $.001 par value per share (“Class A Shares”), at a price of $25.00 per share and Class T common stock, $.001 par value per share (“Class T Shares”), at $23.95 per share, in any combination, in an initial “reasonable best efforts” offering (the “Offering”) which commenced on February 17, 2015. The Company is also authorized to issue up to $190,000,000 of Class A and Class T Shares at a per share price of $23.75 and $22.81, respectively, pursuant to the Company’s distribution reinvestment plan (“DRP”). In addition, the Company declared that each share of common stock that was issued and outstanding immediately prior to the effective date of the amendment of the Company’s charter converted into one issued and outstanding share of Class A common stock. As a result, the 8,000 shares of common stock the Sponsor owned as of December 31, 2014, was converted into 8,000 shares of Class A common stock. No shares of common stock will be sold unless subscriptions for at least $2,000,000, the minimum offering, have been obtained within one year after commencement of the Offering. As of June 30, 2015, the minimum offering has not been met. The Company intends to elect to be taxed as a real estate investment trust (“REIT”) under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Code”), beginning with the year ending December 31, 2015 or the Company’s first year of material operations. In order to maintain the Company’s qualification as a REIT, the Company is required to, among other things, make aggregate annual distributions (other than capital gain dividends) to the Company’s stockholders of at least 90% of the Company’s annual REIT taxable income (which does not equal net income as calculated in accordance with U.S. GAAP) determined without regard to the deduction for dividends paid and excluding net capital gain, and meet certain tests regarding the nature of the Company’s income and assets. If the Company qualifies for taxation as a REIT, the Company generally will not be subject to U.S. federal income tax to the extent it meets certain criteria and distributes its REIT taxable income to its stockholders. Even if the Company qualifies for taxation as a REIT, the Company may be subject to (1) certain state and local taxes on its income, property or net worth, and (2) U.S. federal income and excise taxes on its undistributed income, if any income remains undistributed. The Company intends to operate in a manner that allows the Company to meet the requirements for taxation as a REIT, including creating taxable REIT subsidiaries to hold assets that generate income that would not be consistent with the rules applicable to qualification as a REIT if held directly by the REIT. If the Company were to fail to meet these requirements, it could be subject to U.S. federal income tax on the Company’s taxable income at regular corporate rates. The Company would not be able to deduct distributions paid to stockholders in any year in which it fails to qualify as a REIT. The Company will also be disqualified for the four taxable years following the year during which qualification was lost unless the Company is entitled to relief under specific statutory provisions. The Company provides the following programs to facilitate investment in the Company’s shares and to provide limited liquidity for stockholders. The Company provides stockholders with the option to purchase additional shares from the Company by automatically reinvesting distributions through the DRP, subject to certain share ownership restrictions. For participants in the DRP, distributions paid on Class A Shares and Class T Shares, as applicable, will be used to purchase Class A Shares and Class T Shares, respectively. Such purchases under the DRP will not be subject to selling commissions, dealer manager fees, distribution and stockholder servicing fees or reimbursement of issuer costs in connection with shares of common stock issued through the DRP and are made initially at a price of $23.75 and $22.81 per Class A Share and Class T Share, respectively. The price is subject to change after the earlier of (1) the change of the public offering price in a public “reasonable best efforts” offering of the Company’s Class A Shares from $25.00 per Class A Share or Class T Shares from $23.95 per Class T Share, as applicable, if there is a change, and (2) termination of all “reasonable best efforts” public offerings of the Company’s Class A Shares or Class T Shares, as applicable. The Company may purchase shares under the share repurchase program (“SRP”), if the Company chooses to repurchase them. Subject to funds being available, the Company will limit the number of shares repurchased during any calendar year to 5% of the number of shares of common stock outstanding on December 31st of the previous calendar year. Funding for the SRP will come from proceeds that the Company receives from the DRP. In the case of repurchases made upon the death of a stockholder or qualifying disability, as defined in the SRP, the Company is authorized to use any funds to complete the repurchase, and neither the one year holding period, the limit regarding funds available from the DRP nor the 5% limit will apply. The SRP will immediately terminate if the Company’s shares become listed for trading on a national securities exchange. In addition, the Company’s board of directors, in its sole direction may, at any time amend, suspend or terminate the SRP. The fiscal year-end of the Company is December 31.

Summary of Significant Accounti

Summary of Significant Accounting Policies	6 Months Ended
	Jun. 30, 2015
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	(2) Summary of Significant Accounting Policies General The accompanying consolidated financial statements have been prepared in accordance with U.S. GAAP and require management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Consolidation The accompanying consolidated financial statements include the accounts of the Company, as well as Inland Residential Operating Partnership, L.P., of which the Company is the sole general partner. All intercompany balances and transactions have been eliminated in consolidation. Offering and Organization Costs Costs associated with the Offering are deferred and charged against the gross proceeds of the Offering upon the sale of shares. Formation and organizational costs are expensed as incurred. Cash and Cash Equivalents The Company considers all demand deposits, money market accounts and all short term investments with a maturity of three months or less, at the date of purchase, to be cash equivalents. The Company maintains its cash and cash equivalents at financial institutions. The account balance may periodically exceed the Federal Deposit Insurance Corporation (“FDIC”) insurance coverage and, as a result, there could be a concentration of credit risk related to amounts on deposit in excess of FDIC insurance coverage. The Company believes that the risk will not be significant, as the Company does not anticipate the financial institutions’ non-performance. Income Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for future tax consequences and are attributable to (1) differences between the financial statement carrying amounts and their respective tax bases, and (2) net operating losses. A valuation allowance is established for uncertainties relating to realization of deferred tax assets. As of June 30, 2015, the Company had a deferred tax asset of approximately $180,088, for income tax purposes, for which a valuation allowance was recorded in the same amount due to the uncertainty of realization. Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2014-09, Revenue from Contracts with Customers In April 2015, the FASB issued ASU No. 2015-03, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs

Income Tax

Income Tax	6 Months Ended
	Jun. 30, 2015
Income Tax Disclosure [Abstract]
Income Tax	(3) Income Tax The Company had no uncertain tax positions as of June 30, 2015. The Company expects no significant increases or decreases in uncertain tax positions due to changes in tax positions within one year of June 30, 2015. The Company has no interest or penalties relating to income taxes recognized in the consolidated statements of operations for the three and six months ended June 30, 2015 and 2014. As of June 30, 2015, the tax returns for the calendar years 2014 and 2013 remain subject to examination by U.S. and various state and local tax jurisdictions.

Transactions with Related Parti

Transactions with Related Parties	6 Months Ended
	Jun. 30, 2015
Related Party Transactions [Abstract]
Transactions with Related Parties	(4) Transactions with Related Parties The Company’s Sponsor contributed $200,000 to the capital of the Company for which it received 8,000 shares of common stock which were subsequently converted into 8,000 shares of Class A common stock. Since inception, the Sponsor has also advanced $2,500,000 in cash to the Company, which is included in due to affiliates on the accompanying consolidated balance sheets, to partially fund formation, offering and organization costs. As of June 30, 2015, the Company had incurred $3,666,317 of offering and organization costs. Pursuant to the terms of the Offering, the Business Manager will repay all offering and organization expenses (excluding selling commissions) in excess of 2.0% of the gross proceeds of the Offering or all offering and organization expenses (including selling commissions) which together exceed 10.75% of the gross offering proceeds from Class A Shares and 6.75% of the gross offering proceeds from Class T Shares, sold in the primary offering over the life of the Offering. In the event that the minimum offering amount is not received and accepted, an affiliate of the Business Manager will bear the related costs of the Offering. The following table summarizes the Company’s related party transactions for the three and six months ended June 30, 2015 and 2014 and as of June 30, 2015 and December 31, 2014. Three months ended June 30, Six months ended June 30, Amount Unpaid as of 2015 2014 2015 2014 June 30 , 2015 December 31 , 2014 General and administrative expenses (a) $ 27,301 $ — $ 86,380 $ — $ 79,423 $ 95,289 Organization costs (b) — 308 — 1,385 — — Offering costs (c) 58,862 7,168 120,680 14,190 1,078,615 1,137,378 Sponsor non-interest bearing advances (d) 1,000,000 — 2,200,000 — 2,500,000 300,000 (a) The Business Manager and its related parties are entitled to reimbursement for certain general and administrative expenses relating to the Company’s administration. Such costs are included in general and administrative expenses in the accompanying consolidated statements of operations. Unpaid amounts are included in due to affiliates in the accompanying consolidated balance sheets. (b) The Business Manager or its affiliates will pay or reimburse any organization or offering costs, including any issuer costs, that exceed 10.75% of the gross offering proceeds from Class A Shares, and 6.75% of the gross offering proceeds from Class T Shares sold in the “reasonable best efforts” offering over the life of the Offering. (c) The Company will reimburse the Sponsor and its affiliates for costs and other expenses of the Offering that they pay on the Company’s behalf. Offering costs are offset against the stockholder’s equity accounts. Unpaid amounts are included in due to affiliates in the accompanying consolidated balance sheets. (d) This amount on the accompanying consolidated balance sheets contains non-interest bearing advances made by the Sponsor which the Company intends to repay.

Summary of Significant Accoun11

Summary of Significant Accounting Policies (Policies)	6 Months Ended
	Jun. 30, 2015
Accounting Policies [Abstract]
General	General The accompanying consolidated financial statements have been prepared in accordance with U.S. GAAP and require management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates.
Consolidation	Consolidation The accompanying consolidated financial statements include the accounts of the Company, as well as Inland Residential Operating Partnership, L.P., of which the Company is the sole general partner. All intercompany balances and transactions have been eliminated in consolidation.
Offering and Organization Costs	Offering and Organization Costs Costs associated with the Offering are deferred and charged against the gross proceeds of the Offering upon the sale of shares. Formation and organizational costs are expensed as incurred.
Cash and Cash Equivalents	Cash and Cash Equivalents The Company considers all demand deposits, money market accounts and all short term investments with a maturity of three months or less, at the date of purchase, to be cash equivalents. The Company maintains its cash and cash equivalents at financial institutions. The account balance may periodically exceed the Federal Deposit Insurance Corporation (“FDIC”) insurance coverage and, as a result, there could be a concentration of credit risk related to amounts on deposit in excess of FDIC insurance coverage. The Company believes that the risk will not be significant, as the Company does not anticipate the financial institutions’ non-performance.
Income Taxes	Income Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for future tax consequences and are attributable to (1) differences between the financial statement carrying amounts and their respective tax bases, and (2) net operating losses. A valuation allowance is established for uncertainties relating to realization of deferred tax assets. As of June 30, 2015, the Company had a deferred tax asset of approximately $180,088, for income tax purposes, for which a valuation allowance was recorded in the same amount due to the uncertainty of realization.
Recent Accounting Pronouncements	Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2014-09, Revenue from Contracts with Customers In April 2015, the FASB issued ASU No. 2015-03, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs

Transactions with Related Par12

Transactions with Related Parties (Tables)	6 Months Ended
	Jun. 30, 2015
Related Party Transactions [Abstract]
Schedule of Transactions with Related Parties	The following table summarizes the Company’s related party transactions for the three and six months ended June 30, 2015 and 2014 and as of June 30, 2015 and December 31, 2014. Three months ended June 30, Six months ended June 30, Amount Unpaid as of 2015 2014 2015 2014 June 30 , 2015 December 31 , 2014 General and administrative expenses (a) $ 27,301 $ — $ 86,380 $ — $ 79,423 $ 95,289 Organization costs (b) — 308 — 1,385 — — Offering costs (c) 58,862 7,168 120,680 14,190 1,078,615 1,137,378 Sponsor non-interest bearing advances (d) 1,000,000 — 2,200,000 — 2,500,000 300,000 (a) The Business Manager and its related parties are entitled to reimbursement for certain general and administrative expenses relating to the Company’s administration. Such costs are included in general and administrative expenses in the accompanying consolidated statements of operations. Unpaid amounts are included in due to affiliates in the accompanying consolidated balance sheets. (b) The Business Manager or its affiliates will pay or reimburse any organization or offering costs, including any issuer costs, that exceed 10.75% of the gross offering proceeds from Class A Shares, and 6.75% of the gross offering proceeds from Class T Shares sold in the “reasonable best efforts” offering over the life of the Offering. (c) The Company will reimburse the Sponsor and its affiliates for costs and other expenses of the Offering that they pay on the Company’s behalf. Offering costs are offset against the stockholder’s equity accounts. Unpaid amounts are included in due to affiliates in the accompanying consolidated balance sheets. (d) This amount on the accompanying consolidated balance sheets contains non-interest bearing advances made by the Sponsor which the Company intends to repay.

Organization (Details)

Organization (Details) - USD ($)	6 Months Ended
	Jun. 30, 2015	Dec. 31, 2014
Class of Stock [Line Items]
Total value of common stock company is authorized to sell through initial 'reasonable best efforts' offering	$ 1,000,000,000
Common stock, par value	$ .001	$ .001
Number of common shares Sponsor received, subsequently converted in Class A Common Stock	8,000
Number of Class A shares issued as result of Sponsor converting common shares	8,000
Minimum offering that must be obtained within one year after commencement in order for common shares to be sold pursuant to terms of offering	$ 2,000,000
Limit on number of shares that can be repurchased each calendar year expressed as a percentage of common stock outstanding on December 31st of the previous calendar year	5.00%
Class A Common Stock [Member]
Class of Stock [Line Items]
Common stock, par value	$ .001	.001
Price of each common share authorized to be sold through intial public 'best efforts' offering	25
Initial price of each common share authorized pursuant to distribution reinvestment plan	23.75
Adjusted price of each common share authorized pursuant to distribution reinvestment plan	25
Class T Common Stock [Member]
Class of Stock [Line Items]
Common stock, par value	.001	$ .001
Price of each common share authorized to be sold through intial public 'best efforts' offering	23.95
Initial price of each common share authorized pursuant to distribution reinvestment plan	22.81
Adjusted price of each common share authorized pursuant to distribution reinvestment plan	$ 23.95
Class A and Class T Common Stock [Member]
Class of Stock [Line Items]
Total value of common stock company is authorized to sell pursuant to distribution reinvestment plan	$ 190,000,000

Summary of Significant Accoun14

Summary of Significant Accounting Policies (Details)	Jun. 30, 2015USD ($)
Accounting Policies [Abstract]
Deferred tax asset, gross	$ 180,088
Deferred tax asset valuation allowance	$ 180,088

Income Tax (Details)

Income Tax (Details) - USD ($) None in scaling factor is -9223372036854775296	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014
Income Tax Contingency [Line Items]
Uncertain tax positions
Interest or penalties relating to income taxes recognized in the consolidated statements of operations
Minimum [Member]
Income Tax Contingency [Line Items]
Open tax year	2,013
Maximum [Member]
Income Tax Contingency [Line Items]
Open tax year	2,014

Transactions with Related Par16

Transactions with Related Parties (Narrative) (Details) - Jun. 30, 2015 - USD ($)	Total
Related Party Transactions [Abstract]
Capital contributed by Sponsor for common stock shares	$ 200,000
Number of common shares Sponsor received, subsequently converted in Class A Common Stock	8,000
Number of Class A shares issued as result of Sponsor converting common shares	8,000
Total cash advances provided by Sponsor since Company inception	$ 2,500,000
Total offering and organizational costs incurred since inception	$ 3,666,317

Transactions with Related Par17

Transactions with Related Parties (Schedule of Transactions with Related Parties) (Details) - USD ($)		3 Months Ended		6 Months Ended
		Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014	Dec. 31, 2014
Related Party Transaction [Line Items]
Due to related parties		$ 3,658,038		$ 3,658,038		$ 1,532,667
General and Administrative Expense [Member]
Related Party Transaction [Line Items]
General and administrative expenses	[1]	27,301		86,380
Due to related parties	[1]	$ 79,423		$ 79,423		$ 95,289
Organizational Costs [Member]
Related Party Transaction [Line Items]
Expenses with related parties	[2]		$ 308		$ 1,385
Due to related parties	[2]
Offering Costs [Member]
Related Party Transaction [Line Items]
Expenses with related parties	[3]	$ 58,862	$ 7,168	$ 120,680	$ 14,190
Due to related parties	[3]	1,078,615		1,078,615		$ 1,137,378
Sponsor Non-interest Bearing Advances [Member]
Related Party Transaction [Line Items]
Expenses with related parties	[4]	1,000,000		2,200,000
Due to related parties	[4]	$ 2,500,000		$ 2,500,000		$ 300,000
[1]	The Business Manager and its related parties are entitled to reimbursement for certain general and administrative expenses relating to the Company's administration. Such costs are included in general and administrative expenses in the accompanying consolidated statements of operations. Unpaid amounts are included in due to affiliates in the accompanying consolidated balance sheets.
[2]	The Business Manager or its affiliates will pay or reimburse any organization or offering costs, including any issuer costs, that exceed 10.75% of the gross offering proceeds from Class A Shares, and 6.75% of the gross offering proceeds from Class T Shares sold in the 'reasonable best efforts' offering over the life of the Offering.
[3]	The Company will reimburse the Sponsor and its affiliates for costs and other expenses of the Offering that they pay on the Company's behalf. Offering costs are offset against the stockholder's equity accounts. Unpaid amounts are included in due to affiliates in the accompanying consolidated balance sheets.
[4]	This amount on the accompanying consolidated balance sheets contains non-interest bearing advances made by the Sponsor which the Company intends to repay.