NNN REIT, INC.

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Changes in financial and economic conditions, including inflation and tariffs impacting international trade, may have an adverse impact on NNN, its tenants and commercial real estate in general;

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changes in financial and economic conditions;

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Owning real estate and indirect interests in real estate carries inherent risks;

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inherent risks related to owning real estate and indirect interests in real estate;

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NNN's real estate investments are illiquid;

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the illiquid nature of NNN’s real estate investments;

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A natural disaster or impacts of weather or other event resulting in uninsured loss may adversely affect the operations of NNN's tenants and therefore the ability of NNN's tenants to pay rent, NNN's operating results and asset values of NNN's Property Portfolio (as defined below);

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climate change or impacts of weather on NNN's Property Portfolio (as defined below);

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NNN may be unable to obtain debt or equity capital on favorable terms, if at all;

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NNN’s ability to obtain debt or equity capital on favorable terms, if at all;

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Additional information related to these risks and uncertainties are included in "Item 1A. Risk Factors" of NNN's 2024 Annual Report.

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the other risks identified in "Item 1A. Risk Factors" of NNN's 2025 Annual Report.

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NNN, a Maryland corporation, is a fully integrated REIT formed in 1984. NNN's assets primarily include real estate assets. NNN acquires, owns, invests in and develops high-quality properties that are leased primarily to tenants under long-term, net leases and are primarily held for investment ("Properties" or "Property Portfolio", or individually a "Property").

Current wording

NNN, a Maryland corporation, is a fully integrated REIT formed in 1984. NNN acquires, owns, invests in and develops high-quality properties that are leased primarily to tenants under long-term, net leases, with minimal ongoing capital expenditures and are primarily held for investment ("Properties" or "Property Portfolio" or individually a "Property").

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As of September 30, 2025, NNN owned 3,697 Properties in 50 states, with an aggregate gross leasable area of approximately 39,209,000 square feet and a weighted average remaining lease term of 10.1 years. As of September 30, 2025, 97.5 percent of the Properties were leased.

Current wording

As of March 31, 2026, NNN owned 3,711 Properties in all 50 states, the District of Columbia and Puerto Rico, with an aggregate gross leasable area of approximately 39,597,000 square feet and a weighted average remaining lease term of 10.1 years. As of March 31, 2026, 98.6 percent of the Properties were leased.

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NNN continues to maintain its diversification by tenant, line of trade and geography. NNN's top five line of trade concentrations are the automotive service (18.4%), convenience store (16.2%), restaurant (including full and limited service) (14.5%) and entertainment (7.2%) sectors. NNN's management believes these sectors present attractive investment opportunities. The Property Portfolio is geographically concentrated primarily in regions of historically above-average population growth, including the southeast (25.4%) and south (24.4%) United States. Given these concentrations, any financial hardship within these sectors or geographic regions could have a material adverse effect on the financial condition and operating performance of NNN.

Current wording

NNN continues to maintain its diversification by tenant, line of trade and geography. NNN's top line of trade concentrations are the automotive service (18.7%), convenience stores (16.3%) and restaurants (including full and limited service) (14.4%) sectors. NNN's management believes these sectors present attractive investment opportunities. The Property Portfolio is geographically concentrated in regions of historically above-average population growth, including the southeastern (25.3%) and southern (24.4%) United States. Given these concentrations, any financial hardship within these sectors or geographic regions could have a material adverse effect on the financial condition and operating performance of NNN.

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Rental Income. Rental income increased for the quarter and nine months ended September 30, 2025, compared to the same periods in 2024. The increase is primarily due to the Rental Revenues from NNN's recent Property acquisitions (see "Results of Operations – Property Analysis – Property Acquisitions").

Current wording

Rental Income. Rental income increased for the quarter ended March 31, 2026, compared to the same period in 2025. The increase is primarily due to the Rental Revenues from NNN's recent Property acquisitions (see "Results of Operations – Property Analysis – Property Acquisitions").

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Real Estate. Total real estate expenses increased for the quarter and nine months ended September 30, 2025, compared to the same periods in 2024. NNN focuses on non-reimbursed real estate expenses (total real estate expenses, net of reimbursements from tenants). These expenses are typically attributable to (i) Properties for which the lease terms do not obligate the tenant to pay certain operating expenses, or (ii) vacant Properties. Non-reimbursed real estate expenses increased in amount and as a percentage of total revenues for the quarter and nine months ended September 30, 2025, compared to the same periods in 2024 primarily due to an increase in the number of vacant properties.

Current wording

Real Estate. Total real estate expenses increased for the quarter ended March 31, 2026, compared to the same period in 2025. NNN focuses on non-reimbursed real estate expenses (total real estate expenses, net of reimbursements from tenants). In most cases, these expenses are attributable to (i) Properties for which the lease terms do not obligate the tenant to pay certain operating expenses, or (ii) vacant Properties. Non-reimbursed real estate expenses decreased in amount and as a percentage of total revenues for the quarter ended March 31, 2026, compared to the same period in 2025 primarily due a decrease in the number of vacant properties.

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Depreciation and Amortization. Depreciation and amortization expenses increased for the quarter and nine months ended September 30, 2025, compared to the same periods in 2024. The increase was primarily attributable to the increase in NNN's Property Portfolio from recent acquisitions (see "Results of Operations – Property Analysis – Property Acquisitions") and was partially offset by recent dispositions (see "Results of Operations – Property Analysis – Property Dispositions").

Current wording

Depreciation and Amortization. Depreciation and amortization expenses increased for the quarter ended March 31, 2026, compared to the same period in 2025. The increase was primarily attributable to the increase in NNN's Property Portfolio from recent acquisitions and was partially offset by recent dispositions (see "Results of Operations – Property Analysis").

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Impairment Losses – Real Estate, Net of Recoveries. As a result of NNN's review of long-lived real estate assets, including identifiable intangible assets, NNN recognized real estate impairments, net of recoveries for the quarters and nine months ended September 30, 2025 and 2024, which were less than one percent of NNN's total assets for the respective periods as reported on the Condensed Consolidated Balance Sheets. Due to NNN's core business of investing in real estate leased primarily to tenants under long-term net leases, the inherent risks of owning commercial real estate and unknown potential changes in financial and economic conditions that may impact NNN's tenants, NNN believes it is reasonably possible to incur real estate impairment charges in the future.

Current wording

Impairment Losses – Real Estate, Net of Recoveries. As a result of NNN's review of long-lived real estate assets, including identifiable intangible assets, NNN recognized real estate impairments, net of recoveries for the quarter ended March 31, 2026 and 2025, which were less than one percent of NNN's total assets for the respective periods as reported on the Condensed Consolidated Balance Sheets. Due to NNN's core business of investing in real estate leased primarily to tenants under long-term net leases, the inherent risks of owning commercial real estate and unknown potential changes in financial and economic conditions that may impact NNN's tenants, NNN believes it is reasonably possible to incur real estate impairment charges in the future.

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Retirement and Severance Costs. Retirement and severance costs increased for the nine months ended September 30, 2025, compared to the same period in 2024, primarily due to costs in connection with the retirement and transition agreement of the former Executive Vice President and Chief Financial Officer.

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Retirement and Severance Costs. In March 2025, the former Executive Vice President, Chief Financial Officer, Assistant Secretary and Treasurer retired from employment. During the quarters ended March 31, 2026 and 2025, NNN recorded retirement and severance costs primarily in connection with this retirement and transition agreement.

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Interest Expense. Interest expense increased for the quarter and nine months ended September 30, 2025, compared to the same periods in 2024. The following are the primary changes in fixed rate long-term debt that impacted interest expense:

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Interest Expense. Interest expense increased for the quarter ended March 31, 2026, compared to the same period in 2025. The following represents the primary changes in fixed rate long-term debt that impacted interest expense:

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in May 2024, issued $500,000,000 aggregate principal amount of 5.500% notes due June 2034,

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in July 2025, issued $500,000,000 aggregate principal amount of 4.600% notes due February 2031, and

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NNN's demand for funds has been and will continue to be primarily for (i) payment of operating expenses and dividends, (ii) property acquisitions and construction commitments, (iii) capital expenditures, (iv) payment of principal and interest on its outstanding debt, and (v) other investments.

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NNN's demand for funds has been and will continue to be for (i) payment of operating expenses and dividends, (ii) property acquisitions and construction commitments, (iii) capital expenditures, (iv) payment of principal and interest on its outstanding debt, and (v) other investments.

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Financing Strategy. NNN's financing objective is to manage its capital structure effectively in order to provide sufficient capital to execute its operating and investing strategies while servicing its debt requirements, maintaining its investment grade credit rating, staggering debt maturities and providing value to NNN's stockholders. NNN's capital resources have and will continue to include, if available (i) proceeds from issuing debt or equity in the capital markets; (ii) secured or unsecured borrowings from banks or other lenders; (iii) proceeds from the sale of Properties; and (iv) to a lesser extent, by internally generated funds as well as undistributed funds from operations. However, there can be no assurance that additional financing or capital will be available, or that the terms will be acceptable or advantageous to NNN.

Current wording

Financing Strategy. NNN's financing objective is to manage its capital structure effectively in order to provide sufficient capital to execute its operating and investing strategies while servicing its debt requirements, maintaining its investment grade credit ratings, staggering debt maturities and providing value to NNN's stockholders. NNN's capital resources have and will continue to include, if available (i) proceeds from issuing debt or equity in the capital markets; (ii) secured or unsecured borrowings from banks or other lenders; (iii) proceeds from the sale of Properties; and (iv) to a lesser extent, by internally generated funds as well as undistributed funds from operations. However, there can be no assurance that additional financing or capital will be available, or that the terms will be acceptable or advantageous to NNN.

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NNN typically expects to fund both its short-term and long-term liquidity requirements, including investments in additional properties, with cash and cash equivalents, cash provided from operations, borrowings from NNN's Credit Facility or proceeds from the sale of Properties. As of September 30, 2025, NNN had $158,693,000 of cash, cash equivalents and restricted cash or cash held in escrow and $1,200,000,000 was available for future borrowings under the Credit Facility. NNN may also fund liquidity requirements with new debt or equity issuances, although newly issued debt may bear higher interest rates than the rates on NNN's existing outstanding debt. NNN also has the ability to limit future property acquisitions and strategically increase property dispositions. NNN expects these liquidity sources and the discretionary nature of its property acquisition funding needs will allow NNN to meet its financial obligations over the long term.

Current wording

NNN expects to fund both its short-term and long-term liquidity requirements, including investments in additional properties, with cash and cash equivalents, cash provided from operations, borrowings from the Credit Facility, proceeds from the settlement of outstanding forward sale agreements or proceeds from the sale of Properties. As of March 31, 2026, NNN had $5,397,000 of cash, cash equivalents and restricted cash or cash held in escrow and $1,120,000,000 available for future borrowings under the Credit Facility. In addition, NNN had estimated net proceeds of $73,966,000 available from outstanding unsettled forward sale agreements. NNN may also fund liquidity requirements with new debt or equity issuances. NNN also has the ability to limit future property acquisitions and strategically increase property dispositions. NNN expects these liquidity sources and the discretionary nature of its property acquisition funding needs will allow NNN to meet its financial obligations over the long term.

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Cash Flows. NNN had $158,693,000 of cash, cash equivalents and restricted cash, of which $776,000 was restricted cash or cash held in escrow at September 30, 2025. The table below summarizes NNN's cash flows (dollars in thousands):

Current wording

Cash Flows. NNN had $5,397,000 of cash, cash equivalents and restricted cash, of which $827,000 was restricted cash or cash held in escrow at March 31, 2026. The table below summarizes NNN's cash flows (dollars in thousands):

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Operating Activities. Cash provided by operating activities represents cash received primarily from rental income less cash used for general and administrative and interest expenses. NNN's cash flow from operating activities has been sufficient to pay the distributions for each period presented. The change in cash provided by operations for the nine months ended September 30, 2025 and 2024, is primarily the result of changes in revenues and expenses as discussed in “Results of Operations.” Cash generated from operations is expected to fluctuate in the future.

Current wording

Operating Activities. Cash provided by operating activities represents cash received from rental income less cash used for general and administrative and interest expenses. NNN's cash flow from operating activities has been sufficient to pay the distributions for each period presented. The change in cash provided by operations for the quarters ended March 31, 2026 and 2025, is the result of changes in revenues and expenses as discussed in "Results of Operations." Cash generated from operations is expected to fluctuate in the future.

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Investing Activities. Changes in cash for investing activities are primarily attributable to the acquisitions and dispositions of Properties as discussed in "Results of Operations – Property Analysis." NNN typically uses cash on hand, borrowings from its Credit Facility or proceeds from the sale of Properties to fund the acquisition of its Properties.

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Investing Activities. Changes in cash for investing activities are largely attributable to the acquisitions and dispositions of Properties as discussed in "Results of Operations – Property Analysis." NNN typically uses cash on hand, borrowings from its Credit Facility or proceeds from the sale of Properties to fund the acquisition of its Properties.

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Financing Activities. NNN's financing activities for the nine months ended September 30, 2025, included the following significant transactions:

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Financing Activities. NNN's financing activities for the quarter ended March 31, 2026, included the following significant transactions:

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$2,010,000 from the issuance of 49,776 shares of common stock in connection with the Dividend Reinvestment and Stock Purchase Plan ("DRIP"), and

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$699,000 in net proceeds from the issuance of 16,321 shares of common stock in connection with the Dividend Reinvestment and Stock Purchase Plan ("DRIP"), and

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$329,710,000 in dividends paid to common stockholders.

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$113,502,000 in dividends paid to common stockholders.

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Property Construction. NNN has committed to fund construction on 19 Properties. The improvements of such Properties are estimated to be completed within 12 to 18 months. These construction commitments, at September 30, 2025, are outlined in the table below (dollars in thousands):

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Property Construction. NNN has committed to fund construction on 24 Properties. The improvements on such Properties are estimated to be completed within 12 to 18 months. These construction commitments, at March 31, 2026, are outlined in the table below (dollars in thousands):

Previous wording

Properties. Typically, the Property leases provide for initial terms of 10 to 20 years and a triple-net lease structure, pursuant to which the tenant bears responsibility for operating expenses of the Property, including utilities, real estate taxes and assessments, property and liability insurance, maintenance, repairs and capital expenditures. Therefore, management anticipates that capital demands to meet obligations with respect to these Properties will be modest for the foreseeable future and can be met with funds from operations and working capital. Certain Properties are subject to leases under which NNN retains responsibility for specific costs and expenses associated with the Property. Management anticipates the costs associated with these Properties, NNN's vacant Properties or those Properties that become vacant will also be met with funds from operations and working capital. NNN may be required to borrow under its Credit Facility or use other sources of capital in the event of significant capital expenditures or major repairs.

Current wording

Properties. In most cases, the Property leases provide for initial terms of 10 to 20 years and a triple-net lease structure, pursuant to which the tenant bears responsibility for operating expenses of the Property, including utilities, real estate taxes and assessments, property and liability insurance, maintenance, repairs and capital expenditures. Therefore, management anticipates that capital demands to meet obligations with respect to these Properties will be modest for the foreseeable future and can be met with funds from operations and working capital. Certain Properties are subject to leases under which NNN retains responsibility for specific costs and expenses associated with the Property. Management anticipates the costs associated with these Properties, NNN's vacant Properties or those Properties that become vacant will also be met with funds from operations and working capital. NNN may be required to borrow under its Credit Facility or use other sources of capital in the event of significant capital expenditures or major repairs.

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As of September 30, 2025, NNN owned 94 vacant, un-leased Properties which accounted for less than three percent of total Properties and approximately two percent of aggregate gross leasable area held in the Property Portfolio.

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As of March 31, 2026, NNN owned 53 vacant, un-leased Properties which accounted for less than two percent of total Properties and of aggregate gross leasable area held in the Property Portfolio.

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Additionally, as of October 31, 2025, one property, representing less than one percent of total annualized base rent and of aggregate gross leasable area held in the Property Portfolio was leased to one tenant currently in bankruptcy under Chapter 11 of the U.S. Bankruptcy Code. As a result, this tenant has the right to reject or affirm their lease with NNN.

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Additionally, as of April 27, 2026, NNN had no tenants currently in bankruptcy under Chapter 11 of the U.S. Bankruptcy Code.

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NNN has used, and expects to use in the future, various forms of debt and equity securities primarily to fund property acquisitions and construction on its Properties and to pay down or refinance its outstanding debt.

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NNN has used, and expects to use in the future, cash and various forms of debt and equity securities to fund property acquisitions and construction on its Properties and to pay down or refinance its outstanding debt.

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Line of Credit Payable. In April 2024, NNN amended certain terms of its credit agreement to, among other things, increase borrowing capacity under its unsecured revolving credit facility from $1,100,000,000 to $1,200,000,000 (the "Credit Facility"). The Credit Facility had a weighted average outstanding balance of $75,529,000 and a weighted average interest rate of 5.25% during the nine months ended September 30, 2025. The Credit Facility has a base interest rate of the Secured Overnight Financing Rate ("SOFR") plus a SOFR adjustment of 10 basis points ("Adjusted SOFR"). The Credit Facility bears interest at Adjusted SOFR plus 77.5 basis points; however, such interest rate may change pursuant to a tiered interest rate structure based on NNN's debt rating. Additionally, as part of NNN's environmental, social and governance ("ESG") initiative, pricing may be reduced if specified ESG metrics are achieved. The Credit Facility matures in April 2028, unless the Company exercises its options to extend maturity to April 2029. The Credit Facility also includes an accordion feature which permits NNN to increase the facility size up to $2,000,000,000, subject to lender approval. In connection with the Credit Facility, loan costs are classified asdebt costs on the Condensed Consolidated Balance Sheets. As of September 30, 2025, there was no outstanding balance and $1,200,000,000 was available for future borrowings under the Credit Facility, and NNN was in compliance with each of the Credit Facility financial covenants.

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Line of Credit Payable. NNN's $1,200,000,000 unsecured revolving credit facility (the "Credit Facility") had a weighted average outstanding balance of $132,576,000 and a weighted average interest rate of 4.45% during the quarter ended March 31, 2026. In December 2025, NNN entered into an amendment to the Credit Facility to remove the 10 basis point Secured Overnight Financing Rate ("SOFR") credit spread adjustment. As amended in December 2025, the Credit Facility bears interest at SOFR plus an applicable margin of 77.5 basis points; however, such applicable margin may change pursuant to a tiered margin structure based on NNN's debt rating. Additionally, as part of NNN's environmental, social and governance ("ESG") initiative, pricing may be reduced if specified ESG metrics are achieved. The Credit Facility matures in April 2028, unless the Company exercises its options to extend maturity to April 2029. The Credit Facility also includes an accordion feature which permits NNN to increase the facility size up to $2,000,000,000, subject to lender approval. In connection with the Credit Facility, NNN incurred loan costs of $36,199,000 which are included indebt costs on the Condensed Consolidated Balance Sheets. As of March 31, 2026, there was $80,000,000 outstanding and $1,120,000,000 was available for future borrowings under the Credit Facility, and NNN was in compliance with each of the Credit Facility financial covenants.

Previous wording

In connection with the outstanding note offerings, NNN incurred debt issuance costs totaling $48,020,000 consisting primarily of underwriting discounts and commissions, legal and accounting fees, rating agency fees and printing expenses. Debt issuance costs for all note issuances have been deferred and presented as a reduction to notes payable and are being amortized over the term of the respective notes using the effective interest method.

Current wording

In connection with the outstanding note offerings, NNN incurred debt issuance costs totaling $44,420,000 consisting primarily of underwriting discounts and commissions, legal and accounting fees, rating agency fees and printing expenses. Debt issuance costs for all note issuances have been deferred and presented as a reduction to notes payable and are being amortized over the term of the respective notes using the effective interest method.