NNN REIT, INC. (NNN)

CIK: 0000751364. SIC: 6798 Real Estate Investment Trusts. Latest 10-K as of: 2026-02-11.

SIC breadcrumb: Finance, Insurance, And Real Estate > Holding And Other Investment Offices > SIC 6798 Real Estate Investment Trusts

SEC company page: https://www.sec.gov/edgar/browse/?CIK=751364. Latest filing source: 0001193125-26-045617.

Selected Fundamentals

Financials

Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-02-11. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0000751364.json. Derived margins are computed from the extracted annual SEC facts.

Flow metrics use full-year FY periods from 10-K/10-K/A filings; balance-sheet metrics use FY-end instants. Missing metrics are omitted rather than fabricated.

Financial Charts

Quarterly

Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-02-11. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0000751364.json.

Flow metrics use discrete quarter-length periods from 10-Q/10-Q/A filings. Q4 revenue and net income are derived only when annual FY and nine-month YTD facts exist for the same fiscal year; derived Q4 values are labeled. EPS Q4 is not derived.

Quarterly Charts

Macro Cross-References

• CPIAUCSL - Consumer Price Index for All Urban Consumers: All Items in U.S. City Average
• UNRATE - Unemployment Rate
• FEDFUNDS - Federal Funds Effective Rate
• CES0500000003 - Average Hourly Earnings of All Employees, Total Private
• DFEDTARU - Federal Funds Target Range - Upper Limit
• DFEDTARL - Federal Funds Target Range - Lower Limit
• DGS3MO - Market Yield on U.S. Treasury Securities at 3-Month Constant Maturity
• DGS2 - Market Yield on U.S. Treasury Securities at 2-Year Constant Maturity
• DGS10 - Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity
• DGS30 - Market Yield on U.S. Treasury Securities at 30-Year Constant Maturity
• T10Y2Y - 10-Year Treasury Constant Maturity Minus 2-Year Treasury Constant Maturity
• CPILFESL - Consumer Price Index for All Urban Consumers: All Items Less Food and Energy
• CPIUFDSL - Consumer Price Index for All Urban Consumers: Food
• CPIENGSL - Consumer Price Index for All Urban Consumers: Energy
• CUSR0000SAH1 - Consumer Price Index for All Urban Consumers: Shelter
• PCEPI - Personal Consumption Expenditures: Chain-type Price Index
• PCEPILFE - Personal Consumption Expenditures Excluding Food and Energy: Chain-type Price Index
• PPIACO - Producer Price Index by Commodity: All Commodities
• T10YIE - 10-Year Breakeven Inflation Rate
• U6RATE - Total Unemployed, Plus All Marginally Attached Workers Plus Total Employed Part Time for Economic Reasons
• PAYEMS - All Employees, Total Nonfarm
• CIVPART - Labor Force Participation Rate
• EMRATIO - Employment-Population Ratio
• UNEMPLOY - Unemployed
• CE16OV - Employment Level
• ICSA - Initial Claims
• JTSJOL - Job Openings: Total Nonfarm
• JTSQUR - Quits: Total Nonfarm
• GDPC1 - Real Gross Domestic Product
• A191RL1Q225SBEA - Real Gross Domestic Product: Percent Change from Preceding Period
• INDPRO - Industrial Production: Total Index
• TCU - Capacity Utilization: Total Index
• HOUST - New Privately-Owned Housing Units Started: Total Units
• PERMIT - New Privately-Owned Housing Units Authorized in Permit-Issuing Places: Total Units
• RSAFS - Advance Retail Sales: Retail Trade
• PCE - Personal Consumption Expenditures
• DSPIC96 - Real Disposable Personal Income
• PSAVERT - Personal Saving Rate
• M2SL - M2
• BOPGSTB - U.S. International Trade in Goods and Services: Balance
• MSPUS - Median Sales Price of Houses Sold for the United States
• HSN1F - New One Family Houses Sold: United States
• RHORUSQ156N - Homeownership Rate in the United States
• TTLCONS - Total Construction Spending: Total Construction in the United States
• RRVRUSQ156N - Rental Vacancy Rate in the United States
• TOTALSL - Total Consumer Credit Owned and Securitized
• REVOLSL - Revolving Consumer Credit Owned and Securitized
• DRCCLACBS - Delinquency Rate on Credit Card Loans, All Commercial Banks
• GDP - Gross Domestic Product
• GPDI - Gross Private Domestic Investment
• GCE - Government Consumption Expenditures and Gross Investment
• PCEC - Personal Consumption Expenditures
• NETEXP - Net Exports of Goods and Services
• GFDEBTN - Federal Debt: Total Public Debt
• GFDEGDQ188S - Federal Debt: Total Public Debt as Percent of Gross Domestic Product
• FYFSD - Federal Surplus or Deficit
• FGRECPT - Federal Government Current Receipts
• FGEXPND - Federal Government: Current Expenditures
• MANEMP - All Employees, Manufacturing
• USCONS - All Employees, Construction
• USTRADE - All Employees, Retail Trade
• USFIRE - All Employees, Financial Activities
• USGOVT - All Employees, Government
• AWHAETP - Average Weekly Hours of All Employees, Total Private
• DGORDER - Manufacturers' New Orders: Durable Goods
• NEWORDER - Manufacturers' New Orders: Nondefense Capital Goods Excluding Aircraft
• BUSINV - Total Business Inventories
• EXPGS - Exports of Goods and Services
• IMPGS - Imports of Goods and Services
• IR - Import Price Index (End Use): All Commodities
• PPIFIS - Producer Price Index by Commodity: Final Demand

Latest quarter (10-Q)

Latest 10-Q source: 0001193125-26-194215.

Extracted between Part I Item 2 and the next Item 3/4 or Part II heading after HTML sanitization. Confidence: high. Filing date: 2026-04-30. Report date: 2026-03-31.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis should be read in conjunction with the consolidated financial statements and related notes included in the Annual Report on Form 10-K of NNN REIT, Inc. for the year ended December 31, 2025 ("2025 Annual Report"). The term "NNN" or the "Company" refers to NNN REIT, Inc. and its consolidated subsidiaries.

Forward-Looking Statements

The information herein contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities and Exchange Act of 1934 (the "Exchange Act"). Also, when NNN uses any of the words "anticipate," "assume," "believe," "estimate," "expect," "intend" or similar expressions, NNN is making forward-looking statements. Although management believes that the expectations reflected in such forward-looking statements are based upon present expectations and reasonable assumptions, NNN's actual results could differ materially from those set forth in the forward-looking statements. Further, forward-looking statements speak only as of the date they are made, and NNN undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time, unless required by law. The following is a summary of the risks and uncertainties, although not all risks and uncertainties, that could cause NNN's actual results to differ materially from those presented in NNN's forward-looking statement:

•
changes in financial and economic conditions;

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

•
the financial failure of, or other default in payment by, tenants under their leases and the potential resulting vacancies;

•
NNN’s concentration with certain tenants, industries and geographic locations;

•
NNN’s dependence on single tenant properties;

•
the successful execution of NNN’s acquisition strategies;

•
the illiquid nature of NNN’s real estate investments;

•
the degree and nature of NNN’s competition;

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

•
the accuracy of the tools NNN uses to determine the creditworthiness of its tenants;

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

•
the inability to generate sufficient cash flows to service NNN’s outstanding debt or to comply with financial and other covenants on its debt instruments;

•
NNN's failure to qualify or remain qualified for taxation as a real estate investment trust ("REIT");

•
failure, weakness, interruption or breach in security of the information systems of NNN or its vendors and tenants; and

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

These risks and uncertainties may cause NNN's actual future results to differ materially from expected results. Readers are cautioned not to place undue reliance on such forward-looking statements, which speak only as of the date of this Quarterly Report on Form 10-Q. NNN undertakes no obligation to update or revise such forward-looking statements, whether as a result of new information, future events or otherwise.

Overview

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").

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.

NNN's management team focuses on certain key indicators to evaluate the financial condition and operating performance of NNN. Key indicators include items such as: the composition of the Property Portfolio (such as tenant, line of trade and geographic diversification), the occupancy rate of the Property Portfolio, certain financial performance metrics and profitability measures, industry trends and industry performance compared to that of NNN.

20

NNN evaluates the creditworthiness of its significant current and prospective tenants. This evaluation may include reviewing available financial statements, store level financial performance, press releases, public credit ratings from major credit rating agencies, industry news publications and financial market data (debt and equity pricing). NNN may also evaluate the business and operations of its significant tenants, including past payment history and periodically meeting with senior management of certain tenants.

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.

Additional information related to NNN and the Property Portfolio is included in NNN's 2025 Annual Report.

Results of Operations

Property Analysis

General. The following table summarizes the Property Portfolio:

March 31,

 2026

December 31, 2025

March 31,

 2025

Properties Owned:

Number

3,711

3,692

3,641

Total gross leasable area (square feet)

39,597,000

39,578,000

37,311,000

States

50

50

50

Properties:

Leased and unimproved land

3,658

3,628

3,558

Percent of Properties – leased and unimproved land

98.6

%

98.3

%

97.7

%

Weighted average remaining lease term (years)

10.1

10.2

9.9

Total gross leasable area (square feet) – leased

39,051,000

38,955,000

36,331,000

Total Annualized Base Rent ("ABR")(1)

$

934,612,000

$

928,081,000

$

874,301,000

(1)

ABR represents the monthly cash base rent for all leases in place as of the end of the period multiplied by 12.

21

The following table summarizes the diversification of the Property Portfolio for the top 20 lines of trade as a percentage of ABR:

Lines of Trade

March 31,

 2026

December 31, 2025

March 31,

 2025

1.

Automotive service

18.7%

18.6%

18.2%

2.

Convenience stores

16.3%

16.3%

16.8%

3.

Restaurants – limited service

8.0%

7.9%

8.3%

4.

Entertainment

7.1%

7.2%

7.1%

5.

Dealerships

6.4%

6.6%

5.7%

6.

Restaurants – full service

6.4%

6.4%

7.1%

7.

Health and fitness

3.9%

3.9%

4.0%

8.

Theaters

3.6%

3.7%

3.9%

9.

Automotive parts

3.3%

3.2%

2.4%

10.

Equipment rental

3.0%

3.1%

3.2%

11.

Wholesale clubs

2.2%

2.3%

2.4%

12.

Drug stores

1.9%

2.0%

2.1%

13.

Home improvement

1.9%

1.9%

2.0%

14.

Medical service providers

1.8%

1.8%

2.0%

15.

Early childhood education

1.8%

1.4%

1.1%

16.

Pet supplies and services

1.7%

1.7%

1.6%

17.

Discount retail

1.3%

1.4%

1.4%

18.

Furniture

1.2%

1.2%

1.3%

19.

Travel plazas

1.2%

1.2%

1.2%

20.

Automobile auctions, wholesale

1.1%

1.1%

1.0%

Other

7.2%

7.1%

7.2%

100.0%

100.0%

100.0%

ABR

$

934,612,000

$

928,081,000

$

874,301,000

Property Acquisitions. The following table summarizes the Property acquisitions (dollars in thousands):

Quarter Ended March 31,

2026

2025

Acquisitions:

Number of Properties

41

82

Gross leasable area (square feet)(1)

304,000

831,000

Weighted average cap rate(2)

7.5

%

7.4

%

Total dollars invested(3)

$

145,394

$

232,393

(1)

Includes additional square footage from completed construction on existing Properties.

(2)

Calculated as the initial cash annual base rent divided by the total purchase price of the Properties.

(3)

Includes dollars invested in projects under construction or tenant improvements for each respective period.

NNN typically funds Property acquisitions either through borrowings under NNN's Credit Facility (as defined in "Capital Structure – Line of Credit Payable"), by issuing its debt or equity securities in the capital markets, with undistributed funds from operations or with proceeds from the sale of Properties.

22

Property Dispositions. The following table summarizes the properties sold by NNN (dollars in thousands):

Quarter Ended March 31,

2026

2025

Number of properties(1)

25

10

Gross leasable area (square feet)

246,000

72,000

Net sales proceeds

$

35,827

$

15,839

Net gain on disposition of real estate

$

12,185

$

3,813

Weighted average cap rate(2)

7.2

%

4.9

%

(1)

Sold 16 vacant and nine income producing properties during the quarter ended March 31, 2026 compared to one vacant and nine income producing properties sold during the quarter ended March 31, 2025.

(2)

Calculated as the cash annual base rent divided by the total gross proceeds received for the occupied properties.

NNN typically uses the disposition proceeds to either pay down the Credit Facility or reinvest in real estate.

Analysis of Revenues

The following table summarizes NNN's revenues (dollars in thousands):

Quarter Ended March 31,

2026

2025

Change

Rental Revenues(1)

$

233,969

$

225,056

$

8,913

Real estate expenses reimbursed from tenants(2)

6,045

5,518

527

Rental income

240,014

230,574

9,440

Interest and other income from real estate transactions

410

280

130

Total revenues

$

240,424

$

230,854

$

9,570

(1)

Includes rental income from operating leases, earned income from direct financing leases and percentage rent ("Rental Revenues").

(2)

See "Results of Operations – Analysis of Expenses – Real Estate" for additional information.

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").

23

Analysis of Expenses

The following table summarizes NNN's expenses (dollars in thousands):

Quarter Ended March 31,

2026

2025

Change

General and administrative

$

14,106

$

13,008

$

1,098

Real estate:

Reimbursed from tenants

6,045

5,518

527

Non-reimbursed

3,754

3,857

(103

)

Total real estate

9,799

9,375

424

Depreciation and amortization

70,797

64,617

6,180

Leasing transaction costs

144

130

14

Impairment losses – real estate, net of recoveries

10,680

1,512

9,168

Retirement and severance costs

434

2,173

(1,739

)

Total operating expenses

$

105,960

$

90,815

$

15,145

Interest and other income

$

(28

)

$

(329

)

$

301

Interest expense

52,726

47,723

5,003

Total other expenses

$

52,698

$

47,394

$

5,304

As a percentage of total revenues:

General and administrative

5.9

%

5.6

%

Non-reimbursed real estate

1.6

%

1.7

%

General and Administrative. General and administrative expenses increased in amount and as a percentage of total revenues for the quarter ended March 31, 2026, as compared to the same period in 2025. The increase was primarily attributable to an increase in incentive compensation costs.

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

[Excerpt truncated for page length; source filing is linked above.]

Latest 10-K MD&A

Extracted between Item 7 and the next Item 7A/8 heading after HTML sanitization. Confidence: high. Filing date: 2026-02-11. Report date: 2025-12-31.

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations

This section generally discusses 2025 and 2024 and year-to-year comparisons. Discussions of 2024 and 2023 year-to-year comparisons that are not included in this annual report on Form 10-K can be found in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II, Item 7 of the Annual Report on Form 10-K for the year ended December 31, 2024 filed with the Securities and Exchange Commission ("Commission" or "SEC") on February 11, 2025.

The term "NNN" or the "Company" refers to NNN REIT, Inc. and its consolidated subsidiaries. NNN may elect to treat certain of its subsidiaries as taxable real estate investment trust subsidiaries.

Forward-Looking Statements

The following discussion and analysis should be read in conjunction with the consolidated financial statements and related notes included elsewhere in this Annual Report on Form 10-K. NNN makes statements in this section that are forward-looking statements within the meaning of the federal securities laws. For a complete discussion of forward-looking statements, see the section in this report entitled "Forward-Looking Statements." Certain risks may cause NNN's actual results, performance or achievements to differ materially from those expressed or implied by the following discussion. For a discussion of such risk factors, see "Item 1A. Risk Factors."

Overview

NNN, a Maryland corporation, is a fully integrated real estate investment trust ("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").

As of December 31, 2025, NNN owned 3,692 Properties in all 50 states, the District of Columbia and Puerto Rico, with an aggregate gross leasable area of approximately 39,578,000 square feet and a weighted average remaining lease term of 10.2 years. As of December 31, 2025, 98.3 percent of the Properties were leased.

NNN's management team focuses on certain key indicators to evaluate the financial condition and operating performance of NNN. Key indicators include items such as: the composition of the Property Portfolio (such as tenant, line of trade and geographic diversification), the occupancy rate of the Property Portfolio, certain financial performance metrics and profitability measures, industry trends and industry performance compared to that of NNN.

NNN evaluates the creditworthiness of its significant current and prospective tenants. This evaluation may include reviewing available financial statements, store level financial performance, press releases, public credit ratings from major credit rating agencies, industry news publications and financial market data (debt and equity pricing). NNN may also evaluate the business and operations of its significant tenants, including past payment history and periodically meeting with senior management of certain tenants.

NNN continues to maintain its diversification by tenant, line of trade and geography. NNN's top line of trade concentrations are the automotive service (18.6%), convenience stores (16.3%), restaurants (including full and limited service) (14.3%), entertainment (7.2%) and dealerships (6.6%) 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 (24.6%) United States ("U.S."). 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.

25

As of December 31, 2025 and 2024, the Property Portfolio remained at least 98 percent leased and had a weighted average remaining lease term of approximately 10 years. High occupancy levels coupled with a triple-net lease structure provide enhanced probability of achieving consistent operating results.

Critical Accounting Estimates

The preparation of NNN's consolidated financial statements in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses as well as other disclosures in the financial statements. Estimates are sensitive to evaluations by management about current and future expectations of market and economic conditions. On an ongoing basis, management evaluates its estimates and assumptions; however, actual results may differ from these estimates and assumptions, which in turn could have a material impact on NNN's consolidated financial statements. A summary of NNN's accounting policies and procedures is included in Note 1 of the December 31, 2025 Consolidated Financial Statements. Management believes the following critical accounting policies, among others, affect its more significant estimates and assumptions used in the preparation of NNN's consolidated financial statements.

Real Estate Portfolio. NNN records the acquisition of real estate at cost, including acquisition and closing costs. The cost of Properties developed or funded by NNN includes direct and indirect costs of construction, property taxes, interest, third-party costs and other miscellaneous costs incurred during the development period until the project is substantially completed and available for occupancy.

Purchase Accounting for Acquisition of Real Estate. In accordance with the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") Topic 805, Business Combinations, consideration for the real estate acquired is allocated to the acquired tangible assets, consisting of land, building and tenant improvements and, if applicable, to identified intangible assets and liabilities, consisting of the value of above-market and below-market in-place leases and the value of in-place leases, as applicable, based on their respective fair values.

The fair value estimate is sensitive to significant assumptions, such as establishing a range of relevant market assumptions for land, building and rent and where the acquired property falls within that range. These market assumptions for land, building and rent use the most relevant comparable properties for an acquisition. The final value relies upon ranking comparable properties' attributes from most to least similar.

Lease Accounting. NNN records its leases on the Property Portfolio in accordance with FASB ASC Topic 842, Leases ("ASC 842"). NNN's real estate is predominantly leased to tenants under triple-net leases, whereby the tenant is responsible for all operating expenses relating to the Property, including utilities, real estate taxes and assessments, property and liability insurance, maintenance, repairs and capital expenditures.

Substantially all of NNN's Property Portfolio consists of leases accounted for using the operating method. Under the operating method, revenue is recognized as rentals are earned and expenses (including depreciation) are charged to operations as incurred. When scheduled rentals vary during the lease term, income is recognized on a straight-line basis so as to produce a constant periodic rent over the term of the lease. Accrued rental income is the aggregate difference between the scheduled rents which vary during the lease term and the income recognized on a straight-line basis.

Collectability. In accordance with ASC 842, NNN reviews the collectability of its lease payments on an ongoing basis. NNN considers collectability indicators when analyzing accounts receivable (and accrued rent), historical bad debt levels, tenant credit-worthiness and current economic trends, all of which assist in evaluating the probability of outstanding and future rental income collections and the adequacy of the allowance for doubtful accounts. In addition, tenants in bankruptcy are analyzed and considerations are made in connection with the expected recovery of pre-petition and post-petition bankruptcy claims.

26

When NNN deems the collection of rental income from a tenant not probable, uncollected previously recognized rental revenue and any related accrued rent are reversed as a reduction to rental income and, subsequently, rental income is only recognized when cash receipts are received. At this point, a tenant is deemed cash basis for accounting purposes. If NNN subsequently deems the collection of rental income is probable, any related accrued rental income or expense is restored.

NNN includes an allowance for doubtful accounts in rental income on the Consolidated Statements of Income and Comprehensive Income.

Real Estate – Held For Sale. Real estate held for sale is not depreciated and is recorded at the lower of cost or fair value, less cost to sell. On a quarterly basis, the Company evaluates its Properties for held for sale classification based on specific criteria as outlined in FASB ASC Topic 360, Property, Plant and Equipment, including management's intent to commit to a plan to sell the asset. NNN anticipates the disposition of Properties classified as held for sale to occur within 12 months.

Impairment – Real Estate. NNN periodically assesses its long-lived real estate assets for possible impairment whenever certain events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. These indicators include, but are not limited to: changes in real estate market conditions, the ability of NNN to re-lease properties that are currently vacant or become vacant, properties under contract and/or reclassified as held for sale, persistent vacancies greater than one year and properties leased to tenants in bankruptcy. Management evaluates whether an impairment in carrying value has occurred by comparing the estimated future cash flows (undiscounted and without interest charges), and the residual value of the real estate, with the carrying value of the individual asset. The future undiscounted cash flows are driven by estimated future market rents. Future cash flow estimates are sensitive to the assumptions made by management regarding future market rents, which are affected by expectations about future market and economic conditions. If an impairment is indicated, a loss will be recorded for the amount by which the carrying value of the asset exceeds its estimated fair value. NNN's Properties are predominantly leased to tenants under long-term net leases and held for investment. In most cases, NNN's Property leases provide for initial terms of 10 to 20 years, with cash flows provided over the entire term.

Revenue Recognition. Rental revenues for properties under construction commence upon completion of construction and delivery of the leased asset to the tenant. Rental revenues for non-development real estate assets are recognized when earned in accordance with ASC 842, based on the terms of the lease of the leased asset. Lease termination fees are recognized when collected subsequent to the related lease that is cancelled and NNN no longer has continuing involvement with the former tenant with respect to that property.

New Accounting Pronouncements. Refer to Note 1 of the December 31, 2025, Consolidated Financial Statements for a summary and the anticipated impact of each accounting pronouncement on NNN's financial position and results of operations.

27

Results of Operations

Property Analysis

General. The following table summarizes the Property Portfolio as of December 31:

2025

2024

Properties Owned:

Number

3,692

3,568

Total gross leasable area (square feet)

39,578,000

36,557,000

States

50

49

Properties:

Leased and unimproved land

3,628

3,514

Percent of Properties – leased and unimproved land

98.3

%

98.5

%

Weighted average remaining lease term (years)

10.2

9.9

Total gross leasable area (square feet) – leased

38,955,000

35,826,000

Total Annualized Base Rent ("ABR")(1)

$

928,081,000

$

860,562,000

(1)

ABR represents the monthly cash base rent for all leases in place as of the end of the period multiplied by 12.

The following table summarizes the lease expirations, assuming none of the tenants exercise renewal options, of the Property Portfolio for each of the next 10 years and then thereafter in the aggregate as of December 31, 2025:

# of Properties

Gross Leasable

Area(1)

% of

ABR

# of Properties

Gross Leasable

Area(1)

% of

ABR

2026

117

1,019,000

2.1%

2032

188

1,840,000

4.9%

2027

203

2,714,000

6.3%

2033

134

1,401,000

4.3%

2028

221

1,970,000

4.9%

2034

194

2,838,000

5.9%

2029

137

2,043,000

4.2%

2035

135

1,794,000

4.2%

2030

184

2,417,000

4.7%

Thereafter

1,853

17,833,000

50.6%

2031

261

3,086,000

7.9%

(1)

Square feet.

28

The following table summarizes the diversification of the Property Portfolio for the top 20 lines of trade as a percentage of ABR as of December 31:

Lines of Trade

2025

2024

1.

Automotive service

18.6%

17.1%

2.

Convenience stores

16.3%

17.0%

3.

Restaurants – limited service

7.9%

8.4%

4.

Entertainment

7.2%

7.2%

5.

Dealerships

6.6%

5.8%

6.

Restaurants – full service

6.4%

7.8%

7.

Health and fitness

3.9%

3.9%

8.

Theaters

3.7%

4.0%

9.

Automotive parts

3.2%

2.4%

10.

Equipment rental

3.1%

3.2%

11.

Wholesale clubs

2.3%

2.4%

12.

Drug stores

2.0%

2.2%

13.

Home improvement

1.9%

2.1%

14.

Medical service providers

1.8%

1.8%

15.

Pet supplies and services

1.7%

1.3%

16.

Early childhood education

1.4%

1.1%

17.

Discount retail

1.4%

1.6%

18.

Furniture

1.2%

1.3%

19.

Travel plazas

1.2%

1.2%

20.

Consumer electronics

1.1%

1.3%

Other

7.1%

6.9%

100.0%

100.0%

ABR

$

928,081,000

$

860,562,000

The following table summarizes the diversification of the Property Portfolio by state as of December 31, 2025:

State

# of

Properties

% of ABR

1.

Texas

594

18.4%

2.

Florida

270

8.7%

3.

Illinois

179

5.1%

4.

Georgia

172

4.5%

5.

Ohio

215

4.2%

6.

Michigan

136

3.8%

7.

Indiana

165

3.7%

8.

Tennessee

156

3.7%

9.

Arizona

86

3.5%

10.

North Carolina

158

3.5%

Other

1,561

40.9%

3,692

100.0%

29

Property Acquisitions. The following table summarizes the Property acquisitions for each of the years ended December 31 (dollars in thousands):

2025

2024

Acquisitions:

Number of Properties

239

75

Gross leasable area (square feet)(1)

4,193,000

1,486,000

Weighted average cap rate(2)

7.4

%

7.7

%

Total dollars invested(3)

$

931,017

$

565,416

(1)

Includes additional square footage from completed construction on existing Properties.

(2)

Calculated as the initial cash annual base rent divided by the total purchase price of the Properties.

(3)

Includes dollars invested in projects under construction or tenant improvements for each respective year.

NNN typically funds Property acquisitions either through borrowings under NNN's Credit Facility (as defined in "Capital Structure – Line of Credit Payable"), by issuing its debt or equity securities in the capital markets, with undistributed funds from operations or with proceeds from the sale of Properties.

Property Dispositions. The following table summarizes the properties sold by NNN for each of the years ended December 31 (dollars in thousands):

2025

2024

Number of properties

116

41

Gross leasable area (square feet)

1,079,000

849,000

Net sales proceeds

$

190,474

$

148,658

Net gain on disposition of real estate

$

48,220

$

42,290

Weighted average cap rate(1)

6.4

%

7.3

%

(1)

Calculated as the cash annual base rent divided by the total gross proceeds received for the occupied properties.

NNN typically uses the disposition proceeds to either pay down the Credit Facility or reinvest in real estate.

Analysis of Revenues

The following table summarizes NNN's revenues for each of the years ended December 31 (dollars in thousands):

2025

2024

Change

Rental Revenues(1)

$

904,342

$

848,657

$

55,685

Real estate expenses reimbursed from tenants(2)

20,038

18,811

1,227

Rental income

924,380

867,468

56,912

Interest and other income from real estate transactions

1,833

1,798

35

Total revenues

$

926,213

$

869,266

$

56,947

(1)

Includes rental income from operating leases, earned income from direct financing leases and percentage rent ("Rental Revenues").

(2)

See "Results of Operations – Analysis of Expenses – Real Estate" for additional information.

Rental Income. Rental income increased for the year ended December 31, 2025, compared to the same period 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").

30

Analysis of Expenses

The following table summarizes NNN's expenses for the year ended December 31 (dollars in thousands):

2025

2024

Change

General and administrative

$

46,923

$

44,287

$

2,636

Real estate:

Reimbursed from tenants

20,038

18,811

1,227

Non-reimbursed

17,343

13,506

3,837

Total real estate

37,381

32,317

5,064

Depreciation and amortization

268,439

249,681

18,758

Leasing transaction costs

486

99

387

Impairment losses – real estate, net of recoveries

28,602

6,632

21,970

Retirement and severance costs

3,116

668

2,448

Total operating expenses

$

384,947

$

333,684

$

51,263

Interest and other income

$

(4,246

)

$

(2,980

)

$

(1,266

)

Interest expense

203,955

184,017

19,938

Total other expenses

$

199,709

$

181,037

$

18,672

As a percentage of total revenues:

General and administrative

5.1

%

5.1

%

Non-reimbursed real estate

1.9

%

1.6

%

Real Estate. Total real estate expenses increased for the year ended December 31, 2025, compared to the same period in 2024. 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 increased in amount and as a percentage of total revenues for the year ended December 31, 2025 compared to the same period in 2024 primarily due to an increase in the number of vacant properties.

Depreciation and Amortization. Depreciation and amortization expenses increased for the year ended December 31, 2025, compared to the same period in 2024. The increase is 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").

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 years ended December 31, 2025 and 2024, which were less than one percent of NNN's total assets for the respective years as reported on the 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.

Retirement and Severance Costs. Retirement and severance costs increased for the year ended December 31, 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, Chief Financial Officer, Assistant Secretary and Treasurer.

31

Interest Expense. Interest expense increased for the year ended December 31, 2025, compared to the same period in 2024. The following represents the primary changes in fixed rate long-term debt that impacted interest expense (dollars in thousands):

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

•
in June 2024, redeemed $350,000,000 aggregate principal amount of 3.900% notes due June 2024,

•
in July 2025, issued $500,000,000 aggregate principal amount of 4.600% notes due February 2031 (the "2031 Notes"), and

•
in November 2025, redeemed $400,000,000 aggregate principal amount of 4.000% notes due November 2025 (the "2025 Notes").

In addition to the transactions outlined above, interest expense increased as a result of the Credit Facility's weighted average outstanding balance of $106,166,000 with a weighted average interest rate of 5.04% for the year ended December 31, 2025, compared to a lower weighted average outstanding balance of $60,775,000, but with a higher weighted average interest rate of 6.25% for the year ended December 31, 2024.

Impact of Inflation

NNN's leases typically contain provisions to mitigate the adverse impact of inflation on NNN's results of operations. Tenant leases typically provide for limited increases in rent as a result of fixed increases and/or capped increases in the Consumer Price Index. As a result of limitations on rent increases, during times when inflation is high, rent increases may not meet or exceed the rate of inflation.

Properties are leased to tenants under long-term triple-net leases which typically require the tenant to pay certain operating expenses for a Property, thus, NNN's exposure to inflation is reduced with respect to these expenses. Inflation may have an adverse impact on NNN's tenants and challenge their ability to meet lease obligations, including to pay rent. See "Item 1A. Risk Factors."

Liquidity and Capital Resources

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.

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.

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 or senior unsecured term loan ("Term Loan") or proceeds from the sale of Properties. As of December 31, 2025, NNN had $5,822,000 of cash, cash equivalents and restricted cash or cash held in escrow, and $851,900,000 and $300,000,000 were available for future borrowings under the Credit Facility and Term Loan, respectively. 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.

32

As of December 31, 2025, NNN's ratio of total debt, none of which was secured debt, to total gross assets (before accumulated depreciation and amortization) was approximately 42 percent. The ratio of total debt to total market capitalization was approximately 39 percent. Certain financial agreements, to which NNN is a party, contain covenants that limit NNN's ability to incur additional debt under certain circumstances. The organizational documents of NNN do not limit the absolute amount or percentage of debt that NNN may incur.

Cash Flows. NNN had $5,822,000 of cash, cash equivalents and restricted cash, of which $776,000 was restricted cash or cash held in escrow at December 31, 2025. The table below summarizes NNN's cash flows for each of the years ended December 31 (dollars in thousands):

2025

2024

Cash, cash equivalents and restricted cash:

Provided by operating activities

$

667,131

$

635,504

Used in investing activities

(748,064

)

(424,336

)

Provided by (used in) financing activities

77,693

(207,261

)

Increase (decrease) in cash, cash equivalents and restricted cash

(3,240

)

3,907

Cash, cash equivalents and restricted cash at the beginning of the year

9,062

5,155

Cash, cash equivalents and restricted cash at the end of the year

$

5,822

$

9,062

Cash flow activities include:

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 year presented. The change in cash provided by operations for the years ended December 31, 2025 and 2024, 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.

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.

Financing Activities. NNN's financing activities for the year ended December 31, 2025, included the following significant transactions:

•
$348,100,000 in net borrowings of NNN's Credit Facility,

•
$491,710,000 in net proceeds from the issuance in July of the 2031 Notes,

•
$400,000,000 payment in November for the redemption of the 2025 Notes,

•
$81,106,000 in net proceeds from the issuance of 1,927,893 shares of common stock in connection with the at-the-market equity program ("ATM"),

•
$2,628,000 in net proceeds from the issuance of 65,062 shares of common stock in connection with the Dividend Reinvestment and Stock Purchase Plan ("DRIP"), and

•
$443,202,000 in dividends paid to common stockholders.

33

Material Cash Requirements

NNN's material cash requirements include (i) long-term debt maturities; (ii) interest on long-term debt; (iii) common stock dividends (although all future distributions will be declared and paid at the discretion of the Board of Directors); and (iv) to a lesser extent, Property construction and other Property related costs that may arise.

The table below presents material cash requirements related to NNN's long-term obligations outstanding as of December 31, 2025 (see "Capital Structure") (dollars in thousands):

Year of Obligation

Total

2026

2027

2028

2029

2030

Thereafter

Long-term debt(1)

$

4,550,000

$

350,000

$

400,000

$

400,000

$

—

$

400,000

$

3,000,000

Long-term debt – interest(2)

2,004,131

184,725

169,733

155,067

141,450

134,367

1,218,789

Credit Facility

348,100

—

—

348,100

—

—

—

Total contractual cash obligations

$

6,902,231

$

534,725

$

569,733

$

903,167

$

141,450

$

534,367

$

4,218,789

(1)

Includes only principal amounts outstanding under notes payable and excludes unamortized note discounts and debt costs.

(2)

Interest calculation on notes payable based on stated rate of the principal amount.

Property Construction. NNN has committed to fund construction on 19 Properties. The improvements on such Properties are estimated to be completed within 12 to 18 months. These construction commitments, at December 31, 2025, are outlined in the table below (dollars in thousands):

Total commitment(1)

$

136,213

Less amount funded

(66,542

)

Remaining commitment

$

69,671

(1)

Includes land, construction costs, tenant improvements, lease costs, capitalized interest and third-party costs.

Management anticipates satisfying these obligations with a combination of NNN's cash provided from operations, current capital resources on hand, its Credit Facility, Term Loan, debt or equity financings and property dispositions.

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.

The lost revenues and increased property expenses resulting from vacant Properties or the inability to collect lease payments could have a material adverse effect on the liquidity and results of operations if NNN is unable to re-lease the Properties at comparable rental rates and in a timely manner.

As of December 31, 2025, NNN owned 64 vacant, un-leased Properties which accounted for less than two percent of total Properties and of the aggregate gross leasable area held in the Property Portfolio.

34

Additionally, as of January 30, 2026, less than one percent of total annualized base rent, total Properties and 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.

NNN generally monitors the financial performance of its significant tenants on an ongoing basis.

Dividends. One of NNN's primary objectives is to distribute a substantial portion of its funds available from operations to its stockholders in the form of dividends, while retaining sufficient cash for reserves and working capital purposes and maintaining its status as a REIT.

The following table outlines the dividends declared and paid for NNN's common stock for the years ended December 31 (dollars in thousands, except per share data):

2025

2024

Dividends

$

443,202

$

420,239

Per share

2.360

2.290

The following table presents the characterizations for tax purposes of NNN's common stock dividends for the years ended December 31:

2025

2024

Ordinary dividends(1)

$

2.249524

95.3188

%

$

2.286498

99.8471

%

Nontaxable distributions

0.110476

4.6812

%

0.003502

0.1529

%

$

2.360000

100.0000

%

$

2.290000

100.0000

%

(1)

Eligible for the 20% qualified business income deduction under section 199A of the Internal Revenue Code of 1986, as amended (the "Code").

On January 15, 2026, NNN declared a dividend of $0.600 per share, which is payable February 13, 2026 to its common stockholders of record as of January 30, 2026.

Capital Structure

NNN has used, and expects to use in the future, 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.

The following is a summary of NNN's total debt outstanding as of December 31 (dollars in thousands):

2025

Percentage

of Total

2024

Percentage

of Total

Line of credit payable

$

348,100

7.2

%

$

—

—

%

Notes payable

4,472,324

92.8

%

4,373,803

100.0

%

Total debt outstanding

$

4,820,424

100.0

%

$

4,373,803

100.0

%

35

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 $106,166,000 and a weighted average interest rate of 5.04% during the year ended December 31, 2025. 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 of December 2025, the Credit Facility bears interest at 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, NNN incurred loan costs of $36,146,000 which are included in debt costs on the Consolidated Balance Sheet. As of December 31, 2025, there was $348,100,000 outstanding and $851,900,000 available for future borrowings under the Credit Facility.

Term Loan. In December 2025, NNN entered into a senior unsecured term loan with a $300,000,000 capacity (the "Term Loan"). The Term Loan has a six-month delayed draw commitment period and an accordion option to increase the aggregate facility size up to $500,000,000. The Term Loan matures in February 2029, unless the Company exercises its options to extend maturity to February 2031. Based on NNN's current credit ratings, the Term Loan will bear interest at an effective rate of SOFR plus the applicable margin of 85 basis points. In connection with the Term Loan, NNN incurred loan costs of $2,429,000 which are included in debt costs on the Consolidated Balance Sheet. As of December 31, 2025, no funds had been drawn on the Term Loan.

In accordance with the terms of both the Credit Facility and Term Loan, NNN is required to meet certain restrictive financial covenants, which, among other things, require NNN to maintain certain (i) leverage ratios, (ii) debt service coverage, (iii) cash flow coverage, and (iv) investment limitations. At December 31, 2025, NNN was in compliance with those covenants. In the event that NNN violates any of these restrictive financial covenants, it could cause the debt under the Credit Facility and Term Loan to be accelerated and may impair NNN's access to the debt and equity markets and limit NNN's ability to pay dividends to its stockholders, each of which would likely have a material adverse impact on NNN's financial condition and results of operations.

As of December 31, 2025, NNN had the following outstanding interest rate derivatives that were designated as cash flow hedges to hedge the risk of changes in the interest cash outflows associated with the Term Loan (dollars in thousands):

Description

Aggregate Notional Amount

Estimated

Fair

Value(1)

Effective Date

Two forward starting swaps(2)

$

200,000

$

357

January 15, 2026

(1)

 Included in other assets and other comprehensive income on the Consolidated Balance Sheets (see "Note 10 – Fair Value of Financial Instruments").

(2)

No hedge ineffectiveness was recognized during the year ended December 31, 2025.

On January 15, 2026, the Company drew $200,000,000 on the Term Loan. These forward starting swaps fix SOFR for the $200,000,000 borrowed at 3.22% through January 15, 2029.

36

Universal Shelf Registration Statement. In August 2023, NNN filed a shelf registration statement with the Commission which became automatically effective ("Universal Shelf"). The Universal Shelf permits the issuance by NNN of an indeterminate amount of debt and equity securities, including preferred stock, depositary shares, common stock, stock purchase contracts, rights, warrants and units. NNN may periodically offer one of more of these securities in amounts, prices and on terms to be announced when and if these securities are offered. The specifics of any future offerings along with the use of proceeds of any securities offered, will be described in detail in a prospectus supplements, or other offering materials, at the time of any offering.

Debt Securities – Notes Payable. Each of NNN's outstanding series of unsecured notes is summarized in the table below (dollars in thousands):

Notes(1)

Issue Date

Principal

Discount(2)

Net

Price

Stated

Rate

Effective

Rate(3)

Maturity Date

2026

December 2016

$

350,000

$

3,860

$

346,140

3.600%

3.733%

December 2026(4)(5)

2027

September 2017

400,000

1,628

398,372

3.500%

3.548%

October 2027(4)

2028

September 2018

400,000

2,848

397,152

4.300%

4.388%

October 2028(4)

2030

March 2020

400,000

1,288

398,712

2.500%

2.536%

April 2030(4)

2031

July 2025

500,000

4,090

495,910

4.600%

4.766%

February 2031

2033

August 2023

500,000

11,620

488,380

5.600%

5.905%

October 2033

2034

May 2024

500,000

6,160

493,840

5.500%

5.662%

June 2034

2048

September 2018

300,000

4,239

295,761

4.800%

4.890%

October 2048

2050

March 2020

300,000

6,066

293,934

3.100%

3.205%

April 2050

2051

March 2021

450,000

8,406

441,594

3.500%

3.602%

April 2051

2052

September 2021

450,000

10,422

439,578

3.000%

3.118%

April 2052

(1)

The proceeds from each note issuance were used to (i) pay down the outstanding balance on the Credit Facility, (ii) redeem notes payable prior to maturity, (iii) redeem outstanding preferred stock, (iv) fund future property acquisitions, and/or (v) for general corporate purposes.

(2)

The note discounts are amortized to interest expense over the respective term of each debt obligation using the effective interest method.

(3)

Includes the effects of the discount at issuance.

(4)

The aggregate principal balance of the unsecured note maturities for the next five years is $1,550,000.

(5)

NNN plans to use proceeds from the Credit Facility and/or potential debt or equity offerings to repay the outstanding debt.

37

NNN entered into forward starting swaps which hedged the risk of changes in forecasted interest payments on the forecasted issuance of long-term unsecured notes. Upon the issuance of a series of unsecured notes, NNN terminated such derivatives as outlined in the following table (dollars in thousands):

Notes

Terminated

Description

Aggregate Notional Amount

Liability (Asset) Fair Value When Terminated (1)

Fair Value Deferred In Other Comprehensive Income(2)

2026

December 2016

Two forward starting swaps

$

180,000

$

(13,352

)

$

(13,345

)

2027

September 2017

Two forward starting swaps

250,000

7,690

7,688

2028

September 2018

Two forward starting swaps

250,000

(4,080

)

(4,080

)

2030

March 2020

Three forward starting swaps

200,000

13,141

13,141

2031

June 2025

Two forward starting swaps

200,000

409

409

2052

September 2021

Two forward starting swaps

120,000

1,584

1,584

(1)

The deferred liability (asset) is being amortized over the term of the hedged forecasted transaction using the effective interest method.

(2)

The amount reported in accumulated other comprehensive income will be reclassified to interest expense as interest payments are made on the related notes payable.

Each series of the notes represents senior, unsecured obligations of NNN and is subordinated to all secured debt of NNN. NNN may redeem each series of notes, in whole or in part, at any time prior to the par call date for the notes at the redemption price as set forth in the applicable supplemental indenture relating to the notes; provided, however, that if NNN redeems the notes on or after the par call date, the redemption price will equal 100 percent of the principal amount of the notes to be redeemed, plus accrued and unpaid interest thereon to, but not including, the redemption date.

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.

In accordance with the terms of the indentures pursuant to which NNN's notes have been issued, NNN is required to meet certain restrictive financial covenants, which, among other things, require NNN to maintain (i) certain leverage ratios, and (ii) certain interest coverage. At December 31, 2025, NNN was in compliance with those covenants. NNN's failure to comply with certain of its debt covenants could result in defaults that accelerate the payment under such debt and limit the dividends paid to NNN's stockholders which would likely have a material adverse impact on NNN's financial condition and results of operations. In addition, these defaults could impair its access to the debt and equity markets.

NNN does not use derivatives for trading or speculative purposes or currently have any derivatives that are not designated as hedges.

Equity Securities

At-The-Market Offerings. NNN has established an ATM which allows NNN to sell shares of common stock from time to time. The following table outlines NNN's ATM:

2023 ATM

2020 ATM

Shelf registration statement:

Effective date

August 2023

August 2020

Termination date

August 2026

August 2023

Total allowable shares

17,500,000

17,500,000

Total shares issued as of December 31, 2025

6,579,993

7,722,511

38

The following table outlines the common stock issuances pursuant to NNN's ATM for the years ended December 31 (dollars in thousands, except per share data):

2025(1)

2024

Shares of common stock

1,927,893

4,652,100

Average price per share (net)

$

42.07

$

45.49

Net proceeds

$

81,106

$

211,619

Stock issuance costs(2)

$

1,691

$

3,242

(1)

Includes 35,934 shares settled as part of a forward sale agreement. There were no outstanding forward sale agreements as of December 31, 2025.

(2)

Stock issuance costs consist primarily of underwriters' and agent's fees and commissions and legal and accounting fees.

Dividend Reinvestment and Stock Purchase Plan. In February 2021 and 2024, NNN filed shelf registration statements for its DRIP with the Commission that were automatically effective, and permit NNN to issue up to 6,000,000 and 4,000,000 shares of common stock, respectively. NNN's DRIP provides an economical and convenient way for current stockholders and other interested new investors to invest in NNN's common stock. The following outlines the common stock issuances pursuant to NNN's DRIP for the years ended December 31 (dollars in thousands):

2025

2024

Shares of common stock

65,062

64,654

Net proceeds

$

2,628

$

2,634

39