5. What risk premium will the market associate with our st company’s1 Quarter credit 2010 rating?

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The Sale Leaseback

Sale-Leasebacks are not a new Improve the Recent Sale-Leasebacks concept in the market; however, in in the Market today’s economic climate businesses • Generally, sale-leasebacks are looking for solutions to unlock are structured as off-balance Property: Appliance Recycling capital and increase cash flow. The sheet operating . Centers HQ Sale-Leaseback is one of these • Following the sale, the Buyer: TCF National solutions. seller’s balance sheet no Seller: Appliance Centers of longer reflects a large America Inc. illiquid carried at a Sale Price: $4,700,000 What is a Sale-Leaseback below-market value. Sale Date: September 2009 • The proceeds from a sale- A transaction where the current leaseback can be used to Property: Phillips Eco-Enterprise owner of a property sells the reduce . Center property and then leases it back from Buyer: Wellington Management the new buyer. Tax Benefits Seller: Green Institute Sale Price: $5,100,000 Sale-leasebacks are often utilized to: • Following the sale, the Sale Date: May 2009 seller will be a tenant and if 1. Unlock the Value of Real the qualifies as an Property: Environments Inc. HQ Estate operating lease, the entire Buyer: Real Estate Trust 2. Improve the Balance sheet rental fee is tax deductible Seller: Environments Inc. 3. Realize tax benefits. • A Sale-Leaseback moves Sale Price: $4,000,000 off the seller’s Sale Date: January 2009 balance sheet Unlock the Value of Real Estate Frequently Asked Keys to Success • Provides seller with cash Questions (particularly important if the Before executing a Sale-Leaseback a seller is unable to borrow) 1. What impact will a Sale- seller should meet with an • Frees up capital for other Leaseback have on our experienced commercial real estate opportunities earnings per share? advisor. CB Richard Ellis is the while allowing the owner to 2. How will a Sale-Leaseback market leader in sale-leasebacks and retain possession and use of impact our financial ratios? can provide further details regarding the property 3. What impact will the length these complex transactions. • Can be a substitute for of our lease have on the external financing without building value? the negative aspects of 4. How does the implied cost For Additional Information Contact: taking on more debt of a Sale-Leaseback Neil G. Kolatkar, J.D. compare to alternative debt Associate structures? 952.924.4636