Item 1.01 Entry into a Material Definitive Agreement
Agreements with Brown Family Enterprises, LLC
On February 8, 2023, Generation Income Properties L.P. (the "Operating
Partnership"), the operating partnership of Generation Income Properties, Inc.
(the "Company"), entered into new Amended and Restated Limited Liability Company
Agreements for each of GIPVA 2510 Walmer Ave, LLC ("GIPVA 2510") and GIPVA 130
Corporate Blvd, LLC ("GIPVA 130") in which the Operating Partnership, as the
sole member of GIPVA 2510 and GIPVA 130, admitted a new member, Brown Family
Enterprises, LLC (the "Purchaser"), through the issuance to Purchaser of
membership interests in the form of Class A Preferred Units of GIPVA 2510 and
GIPVA 130. GIPVA 2510 and GIPVA 130 (the "Virginia SPEs") hold the Company's
Norfolk, Virginia properties.
Also on February 8, 2023, both of the Virginia SPEs and the Purchaser entered
into Unit Purchase Agreements in which GIPVA 2510 issued and sold to the
Purchaser 180,000 Class A Preferred Units at a price of $10.00 per unit for an
aggregate price of $1,800,000, and GIPVA 130 issued and sold to the Purchaser
120,000 Class A Preferred units at a price of $10.00 per unit for an aggregate
price of $1,200,000. The Purchaser will be paid an annual 7% preferred return on
the preferred units of the Virginia SPEs (the "SPE Preferred Units"), payable on
a monthly basis, and will share in approximately 16% of the equity in each of
the Virginia SPEs. The Purchaser and the respective SPEs will both have the
right to redeem the SPE Preferred Units after two (2) years for cash in the
amount of the Purchaser's unreturned capital contribution and accrued but unpaid
preferred return (the "Redemption Price"), provided that Purchaser will have the
right to take the Redemption Price (or any portion thereof) in common units of
the Operating Partnership at a conversion price equal to 85% of the average
trading price of the Company's common stock during the 30 trading days preceding
redemption. The proceeds from the sale of the SPE Preferred Units will be
distributed to the Operating Partnership to fund the Operating Partnership's
redemption obligations to two members of the Operating Partnership in the
aggregate amount of $2.48 million and to fund general corporate expenses of the
Operating Partnership.
The foregoing description of the above-referenced Amended and Restated Operating
Agreements and Unit Purchase Agreements and Unit Issuance Agreement and
Amendment to Contribution and Subscription Agreement does not purport to be
complete and is subject to, and qualified in its entirety by reference to, the
full text of the Amended and Restated Operating Agreements and Unit Purchase
Agreements, copies of which are filed herewith as Exhibit 10.1, Exhibit 10.2,
Exhibit 10.3 and Exhibit 10.4 and are incorporated herein by reference.
Agreement with LMB Owenton I, LLC
On February 7, 2023, the Operating Partnership entered into a Unit Issuance
Agreement and Amendment to Contribution and Subscription Agreement (the "LMB
Agreement") with LMB Owenton I LLC, the contributor of the Company's Tampa
Starbucks property located at 10002 N Dale Mabry (the "Contributor"), in which
GIPLP and the Contributor agreed to delay the Contributor's right to require the
redemption of the Contributor's common units in the Operating Partnership until
the third anniversary of the closing of the contribution of the Tampa Starbucks
property, January 14th 2025, and for a reduced redemption price of $7.15 per
common unit. Such agreement was made in consideration of the issuance to
Contributor of an additional 44,228 common units in the Operating Partnership
(the "Additional OP Units"), resulting in Contributor owning an aggregate of
157,771 common units in the Operating Partnership.
The foregoing description of LMB Agreement does not purport to be complete and
is subject to, and qualified in its entirety by reference to, the full text of
the LMB Agreement, a copy of which is filed herewith as Exhibit 10.5 and is
incorporated herein by reference.
Item 3.02. Unregistered Sales of Equity Securities.
The SPE Preferred Units were issued to the Purchaser, and the Additional OP
Units were issued to Contributor, in reliance on the exemption from registration
provided by Section 4(a)(2) of the Securities Act of 1933, as amended (the
"Securities Act"). The offer and sale of the SPE Preferred Units (together with
the common units of Operating Partnership, if any, issuable upon the redemption
of the SPE Preferred Units, and the shares of Company common stock, if any,
issuable pursuant to the redemption of such common units of the Operating
Partnership) and the offer and sale of the Additional OP Units (together with
the shares of Company common stock, if any, issuable pursuant to the redemption
of such common units of the Operating Partnership) did not and does not involve
a "public offering" as defined in Section 4(a)(2) of the Securities Act, was
made without any form of general solicitation to a sophisticated party, and was
made with full access to any information requested regarding the Virginia SPEs
(in the case of the SPE Preferred Units), the Operating Partnership, and the
Company.
Item 9.01 Financial Statements and Exhibits
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(d) Exhibits.
Exhibit
No. Description
10.1 Second Amended and Restated Limited Liability Company Agreement of
GIPVA 130 Corporate Blvd, LLC, dated February 08, 2023
10.2 Unit Purchase Agreement, GIPVA 130 Corporate Blvd, LLC and Brown
Family Enterprises, dated February 08, 2023
10.3 Second Amended and Restated Limited Liability Company Agreement of
GIPVA 2510 Walmer Ave, LLC, dated February 08, 2023
10.4 Unit Purchase Agreement, GIPVA 2510 Walmer Ave, LLC and Brown Family
Enterprises, dated February 08, 2023
10.5 Unit Issuance Agreement and Amendment to Contribution and Subscriction
Agreement, Generation Income Properties, L.P., and LMB Owenton I LLC,
dated February 07, 2023
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document)
Forward-Looking Statements
This Current Report on Form 8-K may contain "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of 1995 that involve
risks and uncertainty. Words such as "anticipate," "estimate," "expect,"
"intend," "plan," and "project" and other similar words and expressions are
intended to signify forward-looking statements. Forward-looking statements are
not guarantees of future results and conditions but rather are subject to
various risks and uncertainties. Such statements are based on management's
current expectations and are subject to a number of risks and uncertainties that
could cause actual results to differ materially from those described in the
forward-looking statements. Investors are cautioned that there can be no
assurance actual results or business conditions will not differ materially from
those projected or suggested in such forward-looking statements as a result of
various factors. Please refer to the risks detailed from time to time in the
reports we file with the SEC, including our Annual Report on Form 10-K for the
year ended December 31, 2021 filed with the SEC, as well as other filings on
Form 10-Q and periodic filings on Form 8-K, for additional factors that could
cause actual results to differ materially from those stated or implied by such
forward-looking statements. We disclaim any intention or obligation to update or
revise any forward-looking statements, whether as a result of new information,
future events, or otherwise, unless required by law.
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