Exhibit 99.5
Generation Income Properties Inc.
Overview to Unaudited Pro Forma Consolidated Financial Statements
The accompanying unaudited pro forma consolidated financial statements have been derived from our historical consolidated financial statements as presented in the Company’s Form 10-K as of December 31, 2021. The unaudited pro forma consolidated balance sheet as of December 31, 2021, is presented to reflect pro forma adjustments as if the Company’s acquisition on January 7, 2022, of the Illinois Property was acquired on December 31, 2021. The Pro Forma Adjustments Illinois Property column represents the fair value purchase price allocation of the assets acquired, including acquisition costs, in connection with the acquisition of the Illinois Property. The unaudited pro forma consolidated statements of operations for the twelve months ended December 31, 2021, are presented as if the acquisitions of the Colorado Property and Illinois Property on December 28, 2021, and January 7, 2022, respectively, were completed on January 1, 2021. Pro forma adjustments include only adjustments that give effect to events that are (1) directly attributable to the transaction and (2) factually supportable regardless of whether they have a continuing impact or are nonrecurring.
The following unaudited pro forma consolidated financial statements should be read in conjunction with our historical audited consolidated financial statements as of December 31, 2021, the “Cautionary Note Regarding Forward-Looking Statements” contained in those filings, and the “Risk Factors” sections contained in those filings.
We have based the unaudited pro forma adjustments on available information and assumptions that we believe are reasonable. The following unaudited pro forma consolidated financial statements are presented for informational purposes only and are not necessarily indicative of what our actual consolidated financial position would have been as of December 31, 2021 assuming the transactions and adjustments reflected therein had been consummated on December 31, 2021 and what our actual consolidated results of operations would have been for the twelve months ended December 31, 2021 assuming the transactions and adjustments reflected therein had been completed on December 31, 2021, and additionally are not indicative of our consolidated future financial condition, results of operations, or cash flows, and should not be viewed as indicative of our future consolidated financial condition, results of operations, or cash flows.
4861-8863-9260.4
GENERATION INCOME PROPERTIES INC.
Pro Forma Consolidated Balance Sheet
(Unaudited)
| Historical |
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| Pro Forma Adjustments Illinois Property |
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| Pro Forma |
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Assets |
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Investment in real estate |
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Property | $ | 41,025,309 |
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| $ | 2,885,732 |
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| $ | 43,911,041 |
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Tenant improvements |
| 482,701 |
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| 55,041 |
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| 537,742 |
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Acquired lease intangible assets |
| 3,304,014 |
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| 276,013 |
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| 3,580,027 |
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Less accumulated depreciation and amortization |
| (3,512,343 | ) |
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| - |
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| (3,512,343 | ) |
Total investments |
| 41,299,681 |
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| 3,216,786 |
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| 44,516,467 |
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Investment in tenancy-in-common |
| 725,082 |
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| - |
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| 725,082 |
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Cash and cash equivalents |
| 10,589,576 |
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| (1,646,922 | ) |
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| 8,942,654 |
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Restricted cash |
| 34,500 |
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| - |
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| 34,500 |
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Deferred rent asset |
| 156,842 |
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| - |
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| 156,842 |
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Prepaid expenses |
| 237,592 |
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| - |
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| 237,592 |
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Deferred financing costs |
| - |
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| - |
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Accounts receivable |
| 88,661 |
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| - |
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| 88,661 |
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Escrow deposit and other assets |
| 288,782 |
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| - |
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| 288,782 |
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Total Assets | $ | 53,420,716 |
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| $ | 1,569,864 |
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| $ | 54,990,580 |
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Liabilities and Stockholders' Equity |
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Liabilities |
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Accounts payable | $ | 201,627 |
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| $ | - |
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| 201,627 |
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Accounts payable - related party |
| 100 |
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| - |
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| 100 |
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Accrued expenses |
| 134,816 |
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| - |
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| 134,816 |
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Acquired lease intangible liability, net |
| 577,388 |
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| 19,864 |
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| 597,252 |
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Insurance payable |
| 33,359 |
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| - |
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| 33,359 |
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Deferred rent liability |
| 228,938 |
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| - |
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| 228,938 |
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Mortgage loans, net of unamortized discount |
| 28,969,295 |
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| 1,550,000 |
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| 30,519,295 |
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Total liabilities |
| 30,145,523 |
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| 1,569,864 |
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| 31,715,387 |
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Redeemable Non-Controlling Interest |
| 9,621,159 |
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| - |
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| 9,621,159 |
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Stockholders' Equity |
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Common stock, $0.01 par value, 100,000,000 shares authorized; 2,172,950 shares issued and outstanding |
| 21,729 |
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| - |
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| 21,729 |
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Additional paid-in capital |
| 19,051,929 |
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| 19,051,929 |
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Accumulated deficit |
| (5,419,624 | ) |
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| - |
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| (5,419,624 | ) |
Total Generation Income Properties, Inc. stockholders' equity |
| 13,654,034 |
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| - |
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| 13,654,034 |
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Total Liabilities and Stockholders' Equity | $ | 53,420,716 |
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| $ | 1,569,864 |
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| $ | 54,990,580 |
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The accompanying notes are an integral part of this unaudited pro forma consolidated financial statement.
4861-8863-9260.4
GENERATION INCOME PROPERTIES INC.
Pro Forma Consolidated Statement of Operations
For the Year Ended December 31, 2021
(unaudited)
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| Historical |
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| Pro Forma Adjustments Colorado Property |
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| Pro Forma Adjustments Illinois Property |
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| Pro Forma |
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Revenue |
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Rental income |
| $ | 3,854,846 |
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| $ | 427,921 |
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| $ | 289,751 |
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| $ | 4,572,518 |
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Other Income |
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| 45,250 |
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| - |
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| - |
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| 45,250 |
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Total revenue |
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| 3,900,096 |
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| 427,921 |
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| 289,751 |
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| 4,617,768 |
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Expenses |
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General, administrative and organizational costs |
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| 1,111,029 |
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| - |
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| - |
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| 1,111,029 |
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Building expenses |
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| 768,182 |
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| 57,637 |
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| 67,019 |
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| 892,838 |
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Depreciation and amortization |
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| 1,508,340 |
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| 98,693 |
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| 176,660 |
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| 1,783,693 |
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Interest expense, net |
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| 1,310,950 |
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| 91,270 |
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| 61,778 |
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| 1,463,998 |
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Compensation costs |
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| 849,701 |
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| 849,701 |
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Total expenses |
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| 5,548,202 |
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| 247,600 |
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| 305,457 |
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| 6,101,259 |
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Operating income (loss) |
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| (1,648,106 | ) |
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| 180,321 |
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| (15,706 | ) |
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| (1,483,491 | ) |
Gain on investment in tenancy-in-common |
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| 12,495 |
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| - |
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| - |
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| 12,495 |
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Gain on disposal of property |
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| 923,178 |
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| - |
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| - |
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| 923,178 |
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Net Income (loss) |
| $ | (712,433 | ) |
| $ | 180,321 |
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| $ | (15,706 | ) |
| $ | (547,818 | ) |
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Less: Net income attributable to non-controlling interest |
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| 530,049 |
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| - |
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| - |
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| 530,049 |
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Net Income (loss) attributable to Generation Income Properties, Inc. |
| $ | (1,242,482 | ) |
| $ | 180,321 |
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| $ | (15,706 | ) |
| $ | (1,077,867 | ) |
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Total Weighted Average Shares of Common Stock Outstanding – Basic |
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| 1,067,599 |
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| 1,067,599 |
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Total Weighted Average Shares of Common Stock Outstanding – Diluted |
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| 1,067,599 |
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| 1,067,599 |
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Basic Loss Per Share Attributable to Common Stockholder |
| $ | (1.16 | ) |
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| $ | (1.01 | ) |
Diluted Loss Per Share Attributable to Common Stockholder |
| $ | (1.16 | ) |
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| $ | (1.01 | ) |
The accompanying notes are an integral part of this unaudited pro forma consolidated financial statement.
4861-8863-9260.4
GENERATION INCOME PROPERTIES INC.
Pro Forma Statement of Taxable Operating Results and Cash to be Made Available by Operations
(unaudited)
The following represents an estimate of the taxable operating results and cash to be made available by operations of the Company based upon the unaudited pro forma consolidated statement of operations for the year ended December 31, 2021. These estimated results do not purport to represent the results of operations for the Company in the future and were prepared based on the assumptions outlined in the unaudited pro forma consolidated statement of operations, which should be read in conjunction with this statement.
Net loss attributable to common stockholders |
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| (1,077,867 | ) |
Net book depreciation and amortization in excess of tax depreciation and amortization |
|
| 390,569 |
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Estimated taxable operating loss |
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| (687,298 | ) |
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Adjustments: |
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Depreciation and amortization |
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| 1,783,693 |
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Amortization of debt issuance costs |
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| 146,641 |
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Amortization of below market leases |
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| (167,092 | ) |
Common stock issued for services |
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| 112,432 |
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Restricted stock unit compensation |
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| 201,690 |
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Equity in earnings on investment in tenancy-in-common |
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| (12,495 | ) |
Gain on sale of property |
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| (923,178 | ) |
Net book depreciation and amortization in excess of tax depreciation and amortization |
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| (390,569 | ) |
Estimated cash to be made available from operations |
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| 63,824 |
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The accompanying notes are an integral part of this unaudited pro forma consolidated financial statement.
4861-8863-9260.4