Disclaimers
This document has been prepared solely for the purpose of providing U.K. and Dutch investors withcertain information under Article 23 of the European Alternative Investment Fund Managers
Directive (European Directive 2011/61/EU) (the “AIFMD”) as implemented in their respective
jurisdictions. Accordingly, you should not use this document for any other purpose.

Prohibition of Sales to EEA and United Kingdom Retail Investors
In addition to the restrictions under the AIFMD, the units of Invincible Investment Corporation(“INV” or the “AIF”) are not intended to be offered, sold or otherwise made available to and should
not be offered, sold or otherwise made available to any retail investor in the European Economic
Area (the “EEA”) or the United Kingdom. For these purposes, a retail investor means a person who
is one (or more) of: (i) a retail client as defined in point (11) of Article 4(1) of Directive 2014/65/EU,
as amended (the “MiFID II”); or (ii) a customer within the meaning of Directive (EU) 2016/97,
where that customer would not qualify as a professional client as defined in point (10) of Article 4(1)of MiFID II; or (iii) not a qualified investor as defined in Regulation (EU) 2017/1129, as amended,(the “Prospectus Regulation”). Consequently no key information document required by Regulation(EU) No 1286/2014, or the PRIIPs Regulation, for offering or selling the units of INV or otherwise
making them available to retail investors in the EEA or the United Kingdom has been prepared andtherefore offering or selling the units of INV, or otherwise making them available, to any retailinvestor in the EEA or the United Kingdom may be unlawful under the PRIIPs Regulation.

United Kingdom
The units of INV are being marketed in the United Kingdom pursuant to Article 59 of the United
Kingdom Alternative Investment Fund Managers Regulations 2013. In accordance with thisprovision, the Consonant Investment Management Co., Ltd. (the “AIFM”) has notified the Financial
Conduct Authority (the “FCA”) of its intention to offer these units in the United Kingdom. For the
purposes of the United Kingdom Financial Services and Markets Act 2000 (“FSMA”) INV is an
unregulated collective investment scheme which has not been authorized by the FCA. Accordingly,
any communications of an invitation or inducement to invest in INV may be made only to: (i)investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000
(Financial Promotion) Order 2005, as amended, or “the Order”; or (ii) high net worth companies andother persons to whom it may lawfully be communicated, falling within Articles 49(2)(a) to (d) of
the Order (all such persons referred to under (i) and (ii) of this paragraph, together being referred toas “Relevant Persons”). In the United Kingdom, this document and its contents are directed only at
Relevant Persons and must not be acted on or relied on by persons who are not Relevant Persons.
Any person who is not a Relevant Person may not act or rely on this document or any of its contents.

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The transmission of this document and its contents in the United Kingdom to any person other than a
Relevant Person is unauthorized and may contravene the FSMA and other United Kingdom
securities laws and regulations.

European Economic Area and United Kingdom Investors
The AIFMD was adopted on June 8, 2011 and was required to be implemented by each Member
State of the EEA into its national legislation by July 22, 2013. The units of INV may not bemarketed (within the meaning given to the term “marketing” under the AIFMD), and theCommunication may not be conducted, to prospective investors domiciled or with a registered officein any Member State of the EEA or the United Kingdom unless: (i) the units of INV may bemarketed under any national private placement regime (including under the AIFMD) or otherexemption in that Member State or the United Kingdom (as applicable); or (ii) the units of INV canotherwise be lawfully marketed or sold in that Member State or the United Kingdom (as applicable)in circumstances in which the AIFMD does not apply, provided that any such offer or sale is notmade to a retail investor as described above. We have made a notification to each of the Netherlands
Authority for the Financial Markets and the United Kingdom Financial Conduct Authority pursuant
to Article 42 of the AIFMD in order to market the units of INV in the Netherlands and the United
Kingdom, respectively.

Netherlands
The units of INV are being marketed in the Netherlands under Section 1:13b of the Netherlands
Financial Supervision Act (Wet op het financieel toezicht, or the “Wft”). In accordance with thisprovision, AIFM has notified the Dutch Authority for the Financial Markets (Authoriteit Financiële
Markten, the “AFM”) of its intention to offer these units in the Netherlands. The units of INV will
not, directly or indirectly, be offered, sold, transferred or delivered in the Netherlands, except to or
by individuals or entities that are qualified investors (gekwalificeerde beleggers) within the meaningof Article 1:1 of the Wft. and as a consequence neither the AIFM nor INV is subject to the license
requirement pursuant to the Wft. Consequently, the AIFM and INV are only subject to limited
supervision of the AFM and the Netherlands Central Bank (De Nederlandsche Bank, “DNB”) for thecompliance with the ongoing regulatory requirements as referred to in the Netherlands law
implementation of Article 42 of the AIFMD. This Article 23 AIFMD Prospectus is not subject toapproval by the AFM. No approved prospectus is required to be published in the Netherlands
pursuant to Article 3 of the Regulation (EU) 2017/1129 as amended and applicable in the
Netherlands.

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Article 23 (1)(a)Objectives of the AIF

INV seeks to achieve distribution growth and enhancement of unitholders’ value
by building a balanced portfolio composed primarily of hotels, particularly limited
service hotels, and affordable residential properties, which together constitute
INV’s “core assets”. By achieving such balance, INV seeks to optimize the mixof stability associated with residential properties and growth opportunities
arising from investments in hotels.

Investment strategy

In addition to investing in and growing a balanced portfolio composed primarilyof hotels and affordable residential properties, INV seeks to:•utilize resources and pipeline support of Fortress Investment Group
LLC and its affiliates (collectively, the “Fortress Group”, whichsponsors INV and is part of the Softbank Group);•source attractive properties using Consonant Investment
Management Co., Ltd.’s (the “Asset Manager”) information network;and•utilize limited service operational expertise of MyStays HotelManagement Co., Ltd. (“MyStays Hotel Management”).

Types of assets theReal estate, including trust beneficiary interests in real estate, securities

AIF may invest in

backed by real estate, specified assets and other assets, including any of theforegoing assets governed by foreign laws and regulations, as well as equity
interests in corporations holding overseas real estate.

Techniques it may

INV invests primarily in hotels and affordable residential properties, while also

employ and all

making investments in select office buildings, retail properties and parking

associated risks

facilities, to achieve distribution growth and enhancement of unitholders’value.

The principal risks with respect to investment in INV are as follows:
Property and Business Risks•

Any adverse conditions in the Japanese economy could adversely affect
INV’s properties.

•

An epidemic such as SARS, MERS and COVID-19 may have asignificant long-term adverse impact on economic activities, including asa result of self-isolation measures, which in turn may adversely affect theoperators’ profitability, performance of INV’s portfolio and market price of
its units.

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•

INV may not be able to acquire properties to execute its growth andinvestment strategy in a manner that is accretive to earnings.

•

INV’s reliance on Fortress Group could have a material adverse effect on
its business.

•

INV’s investment in the Cayman Islands hotels exposes it to risks
inherent in investment in overseas properties, including operational risks
due to its limited experience in operating properties outside of Japan,
exposure to the economic, market and environmental conditions in the
Cayman Islands and foreign exchange risk.INV’s strategy to acquire
properties outside of Japan may expose it to additional risks.

•

As a large portion of INV’s hotels are subject to a variable rent structure,
its results of operations are inherently more volatile than the results ofproperties with fixed-lease arrangements, and INV may not be able toeffectively manage its hotel portfolio due to its relatively limited operating
history in owning full service hotels and resort hotels that it may decide toacquire in greater numbers in the future.

•

INV may not close its anticipated or other future property acquisitions.

•

Increases in prevailing market interest rates, particularly following the
Bank of Japan’s announcement of a major new policy for monetaryeasing, would increase INV’s interest expense and may result in a
decline in the market price of its units.

•

The relatively high geographic concentration of INV’s real estate portfolio
in the greater Tokyo area and other major cities could have a material
adverse effect on its business.

•Competition for tenants and hotel guests may adversely affect INV’s
ability to retain its current tenants and find new tenants, and to maintainoccupancy rates and revenue.

•

INV’s domestic hotels are subject to the operating risks common to thehospitality industry, which have a direct effect on the variable rent
component of its portfolio’s revenue.

•

The cyclical and seasonal nature of the hospitality industry may cause
fluctuations in INV’s operating performance, which could have a material
adverse effect on it and its variable rent revenues.

•

INV may incur unexpected expenses, expenditure or other losses forrepair or maintenance of its properties, and its hotels require periodic
capital reinvestment for renovation.

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•The majority of INV’s hotels are leased to MyStays Hotel Management or
its subsidiaries which are owned by Fortress Group-managed funds, andsubject to the risk of default under their hotel lease agreements.

•

INV’s focus on residential properties could have a material adverse effecton its business.

•

INV may lose rental revenues in the event of defaults by end-tenants
under their lease agreements for properties other than hotels.

•

Master leases may give rise to certain risks.

•

INV may suffer large losses if any of its properties incur damage from anatural or man-made disaster or acts of violence.

•

INV may be liable for an unforeseen loss, damage or injury suffered by athird party at its properties.

•

Because most of INV’s operating expenses are largely fixed, it may
suffer adverse consequences if its rental revenues decline.

•

INV may not be able to promptly acquire suitable properties or sell thosein its portfolio on acceptable terms in response to changing economic,
financial or investment conditions.

•Defects or problems relating to INV’s properties, including nonconformity to agreements, may adversely affect its financial condition
and results of operations.

•

INV relies on expert appraisals and engineering, environmental andseismic reports, which are subject to significant uncertainties.

•

The environmental assessments of INV’s properties made prior to its
ownership may not have uncovered all environmental liabilities, andJapanese laws and other overseas laws subject property owners to strict
environmental liabilities.

•

Decreases in tenant leasehold and/or security deposits would increase
INV’s funding costs.

•

Any inability to obtain financing for future acquisitions, or any restrictions
on INV’s activities under its financing arrangements, could adversely
affect INV.

•

A high LTV ratio may increase INV’s exposure to changes in interest
rates and have a material adverse effect on its results of operations.

•

INV may suffer impairment losses relating to its properties and may also
suffer adverse tax effects upon recognizing impairments.

•

The performance of Fortress Group is not an indicator or guarantee of5
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INV’s future results.
•

INV’s financial statements are prepared in accordance with Japanese
GAAP, which differs in certain material respects from IFRS, U.S. GAAP
and generally accepted accounting principles and financial reporting
standards in other jurisdictions.

•

INV relies on industry and market data that are subject to significant
uncertainties.

•

INV may be exposed to risks relating to investments in the operators or
master lessees of its properties.

Management and Governance Risks•

INV’s success depends on the performances of service providers towhich it is required to assign various key functions.

•

There are potential conflicts of interest between INV and certain FortressGroup affiliates or Fortress Group-related companies including the AssetManager, MyStays Hotel Management.

•

INV depends on the efforts of its executive director and key personnel ofthe Asset Manager.

•

Unitholders have limited control over INV’s policies.

•

The Japanese regulatory authorities have tightened regulatory
supervision of J-REITs and their asset managers and their corporate
governance.

•

If unitholders do not exercise their voting rights, INV may count theirvotes in favor of proposals at a general meeting of unitholders.

Taxation Risks•

INV’s failure to satisfy a complex series of requirements pursuant toJapanese tax regulations would disqualify INV from certain taxation
benefits and significantly reduce its distributions to its unitholders.

•

If the Japanese tax authorities disagree with the interpretations INV used
for prior periods, it may be forced to pay additional taxes for those
periods.

•

INV may not be able to benefit from reductions in certain real estatetaxes enjoyed by qualified J-REITs.

•

Changes in Japanese tax laws may significantly increase INV’s tax
burden.

•INV may be subject to taxes in countries other than Japan due to its
investments outside of Japan and investors may not be able to take6
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advantage of available credits associated with such taxes.
•

INV’s distributions may decrease due to reversals of allowance fortemporary differences adjustment.

•

INV expects to be treated as a “passive foreign investment company” for
U.S. federal income tax purposes.

•

Unitholders may become subject to U.S. Foreign Account Tax
Compliance Act (FATCA) withholding tax.

Legal and Regulatory Risks•

INV’s ownership rights in some of its properties may be declared invalid
or limited.

•

INV’s may lose its rights in a property it owns if the purchase of theproperty is recharacterized as a secured financing.

•

Acquisition of properties for which third parties hold leasehold interests inthe land and own the buildings may subject INV to various risks.

•

INV’s leasehold interests may be terminated or may not be asserted
against a third party in some cases, or its leases with its tenants could be
modified.

•

INV currently hold interests in Sheraton Grande Tokyo Bay Hotel through,and may make further investments in, preferred equities of a TMK (tokutei
mokuteki kaisha), and illiquidity in the market for such equities may limit
its ability to sell its interests, and INV is exposed to risks unique to thisinvestment structure.

•

INV may hold interests in some properties through Japanese anonymous
association (tokumei kumiai) agreements.

•

INV currently holds several properties in the form of compartmentalized
ownership interests (kubun shoyu-ken) and its rights relating to suchproperties may be affected by the intentions of other owners•

INV may acquire properties in the form of co-ownership (kyoyu) and its
rights relating to such properties may be affected by the intentions ofother owners.

•

Tax increases or adverse changes in applicable laws may affect INV’s
potential liabilities relating to its properties and operations.

•

Compliance with energy conservation regulations in Japan may
adversely affect INV’s financial results.

•

INV’s costs of complying with regulations applicable to its properties
could adversely affect its results of operations.

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•

INV owns a substantial portion of its properties through trust beneficiaryinterests and may suffer losses as a trust beneficiary.

•

The Alternative Investment Fund Managers Directive (AIFMD) may
negatively affect INV’s ability to market its units in the EEA and increase
its compliance costs associated with the marketing of its units in the
EEA.

•

INV’s assets may be deemed to constitute “plan assets” for ERISA
purposes, which may lead to the rescission of certain transactions, tax or
fiduciary liability and its being held in violation of ERISA requirements.

Any applicable

INV is subject to investment restrictions under Japanese laws and regulations

investment restrictions(e.g., the Act on Investment Trusts and Investment Corporations (the “ITA”),
the Financial Instruments and Exchange Act (the “FIEA”)) as well as its
articles of incorporation.
INV must invest primarily in specified assets as defined in the ITA. Specified
assets include, but are not limited to, securities, real estate, leaseholds of realestate, surface rights (chijō-ken) (i.e., right to use land for the purpose of
having a structure on it) or trust beneficiary interests for securities or realestate, leaseholds of real estate or surface rights.
Furthermore, a listed J-REIT must invest substantially all of its assets in realestate, real estate-related assets and liquid assets as provided by the listing
requirements. Real estate in this context includes, but is not limited to, realestate, leaseholds of real estate, surface rights, and trust beneficiary interests
for these assets, and real estate-related assets in this context include, but notlimited to, anonymous association (tokumei kumiai) interests for investment inreal estate.
Pursuant to the ITA, investment corporations may not independently develop
land for housing or to construct buildings, but may outsource such activities incertain circumstances.
The investment by the AIF must be made in accordance with the basic
investment policy as set out in its articles of incorporation.

Circumstances in

INV may take out loans or issue investment corporation bonds (includingwhich the AIF may

short-term corporation bonds) for the purpose of, among other things,

use leverageacquiring assets, repair or distribution payments and acquiring operational
funding or procuring funds for debt repayment, which are conducive to theefficient management of investment assets and the stability of management.

The types and

INV may take out loans or issue investment corporation bonds for financing its

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sources of leverage

activities.

permitted and

INV currently has outstanding loans from major financial institutions, such as

associated risks

Mizuho Bank, Ltd., Sumitomo Mitsui Trust Bank, Limited, The Bank of TokyoMitsubishi UFJ, Ltd. and Sumitomo Mitsui Banking Corporation.
INV currently does not have any outstanding guarantees and may be subject
to restrictive covenants in connection with any future indebtedness that may
restrict the operations and limit the ability to make cash distributions tounitholders, to dispose of the properties or to acquire additional properties.
Furthermore, INV may violate restrictive covenants contained in the loan
agreements INV executes, such as the maintenance of debt service coverageor loan-to-value, or LTV, ratios, which may entitle the lenders to require INV tocollateralize the properties or demand that the entire outstanding balance be
paid. Further, in the event of an increase in interest rates, to the extent that
INV has any debt with unhedged floating rates of interest or INV incurs new
debt, interest payments may increase, which in turn could reduce the amountof cash available for distributions to unitholders. Higher interest rates may also
limit the capacity for short- and long-term borrowings, which would in turn limit
the ability to acquire properties, and could cause the market price of the units
to decline.

Any restrictions on

The maximum amount of any borrowing and issuance of investment

leverage

corporation bonds is JPY 500 billion each, and the aggregate amount of all
such debt must not exceed JPY 500 billion.

Any restrictions on

No applicable arrangements.

collateral and asset
reuse arrangements
Maximum level of

INV has, in principle, set an upper limit of 60% for its LTV ratio (based on bookleverage which thevalue) in order to operate with a stable financial condition. INV may, however,

AIFM is entitled totemporarily exceed such level as a result of acquiring new investment assets.

employ on behalf of
the AIF
Article 23(1) (b)Procedure by which

INV’s investment policy is set forth in its articles of incorporation. As a result,the AIF may change

any change in its investment policy will require an amendment of its articles of

its investment strategy

incorporation. Amendment of the articles of incorporation requires a quorum of/ investment policya majority of the total issued units and at least a two-thirds vote of the voting
rights represented at the meeting. Unitholders should note, however, that9
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under the ITA and INV’s articles of incorporation, unitholders who do notattend and exercise their voting rights at a general meeting of unitholders are
deemed to be in agreement with proposals submitted at the meeting, except incases where contrary proposals are also being submitted.
Additionally, the guidelines of the AIFM, which provide more detailed policies
within INV’s overall investment strategy and policy, can be modified without
such formal amendment of the articles of incorporation.
Article 23(1) (c)Description of the

INV is a corporate-type investment trust in the form of investment corporation

main legal(toshi hojin) provided for under the ITA. Therefore, the relationship between

implications of the

INV and its unitholders is governed by INV’s articles of incorporation (ascontractual

opposed to individual agreements), which can be amended from time to time

relationship entered

upon resolution of a general unitholders’ meeting. INV’s articles of

into for theincorporation stipulate rules relating to general unitholders meetings, including

purpose of

the convocation, setting of record date, exercise of voting rights, resolutions

investment, including

and election of INV’s directors.

jurisdiction, applicable

The relationship between INV and its unitholders is also governed by, and islaw, and the existence

subject to the provisions of, Japanese law, including the ITA.

or not of any legal

The courts in Japan would recognize as a valid judgment any final andinstruments providing

conclusive civil judgment for monetary claims (which, for this purpose, arefor the recognition andlimited to those of a purely civil nature and do not include monetary claims ofenforcement of

the nature of criminal or administrative sanction, such as punitive damages,

judgments in theeven though they take the form of civil claims) against INV obtained in aterritory where the AIF

foreign court provided that (i) the jurisdiction of such foreign court is admitted

is establishedunder the laws of Japan, (ii) INV has received service of process for thecommencement of the relevant proceedings, otherwise than by a public noticeor any method comparable thereto, or has appeared without any reservation
before such foreign court, (iii) neither such judgment nor the relevant
proceeding is repugnant to public policy as applied in Japan, (iv) there exists
reciprocity as to the recognition by such foreign court of a final judgment
obtained in a Japanese court and (v) there is no conflicting judgement on thesubject matter by any Japanese court.

The AIFM has entered into a sponsor support agreement with Fortress
Investment Group Japan Godo Kaisha. INV has also entered into amemorandum of understanding with certain Fortress Group-related SPCs,

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which provides INV with preferential negotiation rights to acquire certain
properties.
All of the above agreements are governed by Japanese law.
INV is not involved in or threatened by any legal arbitration, administrative orother proceedings, the results of which might, individually or in the aggregate,
be material.
Article 23(1) (d)The identity of the⚫

AIFM (Asset Manager) / General Administrator: Consonant Investment

AIFM, AIF's

Management Co., Ltd.

depositary, auditor

The Asset Manager provides the services including asset management,

and any other service

financing, investor relations and financial reporting, and operational

providers and aplanning.

description of their

The General Administrator provides administrative services to us,

duties and theincluding administration of unitholder meetings (excluding services

investors' rights

related to distribution of documents for the unitholders’ meeting andtheretoacceptance and tabulation of the voting ballots) and administration ofboard meetings.
⚫

Auditor: Ernst & Young ShinNihon LLC
The independent auditor audits financial statements and prepare audit
reports.

⚫

Asset Custodian / Unitholders’ Register Administrative Agent / Special
Accounts Administrator: Sumitomo Mitsui Trust Bank, Limited (“SMTB”)
The Asset Custodian provides custodial services to us, including custodyof our assets.
The Unitholders’ Register Administrative Agent provides administrative
services to us, including creation, administration and custody of theunitholders’ register and related documents.
The Special Accounts Administrator provides administrative services tous, including the preparation, management and custody of the transfer
account book and other services in relation to the special accounts ofpre-merger unitholders of LCP.

⚫

Special Accounts Administrator: Mitsubishi UFJ Trust and Banking
Corporation (“MUTB”)
The Special Accounts Manager provides administrative services to us,
including the preparation, management and custody of the transfer
account register and collection, registration, custody, use, removal and

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deletion of the individual number and other information in relation to thespecial accounts of pre-merger unitholders of us.
⚫

Accounting Administrator: SMTB
The Accounting Administrator provides administrative services to us,
including administration of accounting matters, preparation of accounting
books and tax-related services.

INV relies on Consonant Investment Management Co., Ltd. to manage its
operations, to formulate and implement strategies to achieve its investment
objectives and to administer unitholder meeting and board meetings. Ernst &Young ShinNihon LLC is INV’s independent auditor and audits INV’s financial
statements. SMTB provides custodian services and certain administrative
services to INV, including custody of its assets, creation of the unitholders’register and preparation of the transfer account book in relation to the special
accounts of pre-merger unitholders of LCP Investment Corporation (“LCP”).
MUTB provides certain administrative services to INV, including the custody ofthe transfer account register in relation to the special accounts of pre-merger
unitholders of INV. SMTB provides certain administrative services to INV,
including the administration of accounting matters and preparation of
accounting books.

Service providers owe contractual obligations under their respective
agreements with the AIF or the AIFM, as the case may be. In addition, the
FIEA provides that the Asset Manager owes the AIF a fiduciary duty and must
conduct its activities as the Asset Manager in good faith. The FIEA also
prohibits the Asset Manager from engaging in certain specified conduct,
including entering into transactions outside the ordinary course of business orwith related parties of the Asset Manager that are contrary to or violate the
AIF’s interests. Pursuant to the ITA, the unitholders have the right to approvethe execution or termination of the asset management agreement at a general
meeting of unitholders.

The unitholders do not have any contractual relationship with INV’s service
providers and therefore will not be able to bring any contractual claims against
a service provider.
Article 23(1) (e)12tk-774732

Description of how the

Not applicable.

AIFM complies withthe requirements tocover professional
liability risks (ownfunds / professional
indemnity insurance)
Article 23(1) (f)Description of any

Not applicable. There is no delegation of such functions beyond the AIFM,

delegatedwhich is responsible for portfolio and risk management, and the asset

management function

custodian, which is responsible for safekeeping activities.

such as portfolio
management or risk
management and of
any safekeeping
function delegated by
the depositary, theidentification of thedelegate and any
conflicts of interest
that may arise fromsuch delegations
Article 23(1) (g)Description of theINV makes investment decisions based on the valuation of properties, upon

AIF’s valuationconsideration of the property appraisal value. INV evaluates assets inprocedure and pricing

accordance with its articles of incorporation. The methods and standards thatmethodology,

INV uses for the evaluation of assets are based on the Regulations

including the methods

Concerning the Calculations of Investment Corporations, as well as theused in valuing hard-

Regulations Concerning Real Estate Investment Trusts and Real Estate

to-value assets

Investment Corporations and other regulations stipulated by ITA, in addition to
Japanese GAAP. J-REITs may only use the valuation methods prescribed in
the rules of the Investment Trusts Association, Japan, which emphasize
market price valuation.

Article 23(1) (h)Description of the

INV seeks to manage its capital resources and liquidity sources to provide

AIF’s liquidity risk

adequate funds for current and future financial obligations and other cash

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management,

needs and acquisitions.

including redemption

Net cash provided by operating activities constitutes INV’s primary source ofrights in normal andliquidity to fund distributions, interest payments on loans payable, fees to the

exceptional

Asset Manager and other service providers, property-related taxes, repairs

circumstances andand maintenance, and capital expenditures for its properties in the ordinary

existing redemption

course of business. INV’s liquidity risks are managed by the Asset Manager byarrangements withpreparing monthly plans for funds, and monitoring the covenants defined ininvestors

loan agreements.
As INV is a closed-end investment corporation, unitholders are not entitled torequest the redemption of their investment.

Article 23(1) (i)Description of all fees,

Compensation: INV’s articles of incorporation provide that it may pay its

charges andexecutive director up to JPY 800,000 per month and its supervisory director up

expenses and a

to JPY 400,000 per month. The board of directors is responsible for

maximum amountdetermining the amounts of the monthly remuneration for the executive

which is directly /director and the supervisory director.

indirectly borne by theinvestors

Asset Manager:•

Asset Management Fee: INV pays to the AIFM an asset management
fee as follows:(1)

From January 2021 through December 2021, as a fee for every half
accounting period (three months), an amount not exceeding the lower of
either (A) the amount calculated by multiplying the total amount of therelevant assets recorded as of the end of the relevant half accounting
period by 0.4%, and then dividing by 4 (disregarding any amounts lessthan one yen) or (B) JPY 150,000,000:(2)

From January 2022, as a monthly fee, the higher of either (A) the amountcalculated by multiplying the total amount of the relevant assets recorded
as of the end of each relevant month by 0.4%, and then dividing by 12(disregarding any amounts less than one yen) or (B) JPY 25,000,000.

•

Acquisition Fee:
If INV acquires any real estate or other underlying real estate by which
other assets, including trust beneficiary interests, which are backed by
any Real Estate, etc., which are targeted for asset investment, INV pays
an amount not exceeding 0.5% of the amount contributed by INV among
the purchase price thereof (excluding an amount equivalent to the14
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consumption tax thereon relevant to the building) within three months
from the end of the month in which the date of acquisition of such assets
falls.
•

Disposition Fee:
If INV disposes of any real estate or other underlying real estate by which
other assets, including trust beneficiary interests, which are backed by
any Real Estate, etc., which are targeted for asset investment, INV pays
an amount not exceeding 0.5% the amount received by INV among of
the disposition price thereof (excluding an amount equivalent to theconsumption tax thereon relevant to the building) within three months
from the end of the month in which the date of disposition of such assets
falls.

•

Administrative Agency Fee:
INV pays the AIFM a fee of JPY 100,000 for each month, payable on aquarterly basis for services performed during the three-month periods
ending March 31, June 30, September 30, and December 31,
respectively, and payable within two months of the end of the relevant
period. If INV holds a general meeting of unitholders, INV pays the AIFM
an additional fee of JPY 500,000 for services performed in connection
with each such meeting, payable within the three month period
immediately following the end of the month in which such meeting is
held.

Custodian:•Custodian Fee:
INV pays to the Asset Custodian a custodian fee for each fiscal period,
which may not exceed, on an annual basis, 0.02% of the total amount of
its assets.

Unitholders’ Register Administrative Agent:•Standard Fees:
INV pays standard fees for services such as storage and administrationof INV’s unitholder’s register, monthly reports or other reports that form
part of the regular services, and the determination of the identity of INV’s
unitholders as of end-of-period, mid-period, and quarterly dates(excluding extraordinary determinations) and compilation of various

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statistical data. Monthly standard fees are equal to one-sixth of the sumof the total amount of fees calculated in the manner below, provided thatthe minimum monthly fee is set at JPY 200,000.
Number of unitholders

Fees per Unitholder

The first 5,000 unitholders

JPY 480

Over 5,000 and not more than 10,000

JPY 420

Over 10,000 and not more than 30,000

JPY 360

Over 30,000 and not more than 50,000

JPY 300

Over 50,000 and not more than 100,000

JPY 260

Over 100,000 unitholders

JPY 225

INV also pays a JPY 70 fee per case for data entry regarding
deregistrations from the unitholder’s register.
•

Administration of Distributions Fees:
INV pays fees for the calculation of distributions and services such as thecreation of distribution records and receipts, processing of stamp tax
payment, preparation of payment records, determination of unpaid
distributions and preparation of unpaid distributions records, preparationof wire transfer notices, wire transfer tape and wire transfer slips for
distributions, application of withholding tax rates other than general tax
rates, and preparation of distribution statements of accounts. The fees
are determined based on the total number of unitholders as of the record
date and calculated according to the table below, provided that theminimum fee is set at JPY 350,000.
Number of unitholders

Fees per unitholder
receiving
distributions

The first 5,000 unitholders

JPY 120

Over 5,000 and not more than 10,000

JPY 110

Over 10,000 and not more than 30,000

JPY 100

Over 30,000 and not more than 50,000

JPY 80Over 50,000 and not more than 100,000

JPY 60Over 100,000 unitholders

JPY 50

INV pays an additional charge of JPY 150 per instance in connection
with distribution wire transfer instructions; a charge of JPY 100 per
instance in connection with postal dividends receipts; a charge of JPY
150 per instance in connection with the application of special tax rates;

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and a charge of JPY 15 per instance for preparation of distribution
account statements.

Special Accounts Administrator:•

Special Account Administration Fees (SMTB):
These fees are for the administration of special accounts, transfer agent
and handling reports, verification of securities storage and transfer
mechanism and total unit numbers, and creation of reports on transaction
totals. The fees are based on the total number of subscribers as of theend of the relevant month and are calculated according to the tablebelow. There is a minimum special account administration fee of JPY
20,000 per month.

•

Number of subscribers

Fees per subscriber

The first 5,000 subscribers

JPY 150

Over 5,000 and up to 10,000

JPY 130

Over 10,000 subscribers

JPY 110Special Account Administration Fees (MUTB):
These fees are for the creation and administration of the transfer accountregister and the account ledger attached thereto; for reports for the
notification of general unitholders; new listing, registration, cancellation,and total cancellation procedures; individual unitholder requests for
information; listing and registration in the transfer account register, listing
and registration of pledges, and listing and registration of trustees andassets held in trust; the opening and closing of special accounts;
registration of seals for subscriber information and notifications, renewalof registration, and notifications to the subscriber information
mechanism; services related to requests for the opening of special
accounts for purchasers under the New Act on the Transfer of Corporate
Bonds, etc.; and services relating to unit splits and reverse unit splits.
The fees are based on the total number of unitholders as of the end of
the relevant month and calculated according to the table below. There isa minimum fee of JPY 20,000 per month.
Number of unitholders

Fees per unitholder

The first 3,000 unitholder

JPY 150

Over 3,000 and up to 10,000

JPY 125

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Over 10,000 and up to 30,000

JPY 100

Over 30,000 unitholders

JPY 75

INV also pays special account administration fees for the administrationof each special account (except for certain unitholders as separately
defined) as follows: a fee of JPY 150 for a general unitholder report; afee of JPY 250 for offer or receipt of an individual unitholder notification;a fee of JPY 250 for receipt of information requests; a fee of JPY 250 forreceipt of various notices; and a fee of JPY 130 for services related to
distribution wire transfers.

Accounting Administrator:•

Accounting Administration Fee:
INV pays an accounting administration fee, payable by the end of themonth immediately following the month in which it receives an invoicefrom the Accounting Administrator. The accounting administration fee forany month is established by written agreement between INV and the
Accounting Administrator, subject to a cap calculated as follows: total
assets shown on INV’s trial balance as of the end of the immediately
prior month, multiplied by 0.09% and divided by 12 (subject to aminimum fee of JPY 500,000).
The accounting administration fee in respect of any period less than amonth is calculated on a daily pro rata basis for such period.

Auditor:•

Auditor Fee:
Remuneration for the independent auditor shall be determined by theboard of directors within the maximum amount of JPY 25,000,000 per
fiscal period subject to audit.

INV may also incur other miscellaneous fees in connection with the payment
of distributions; certain notices, investigations and certificates; mailing ofnotices; handling of returned mail; preparation for general unitholders’meetings; preparation of table of unitholders; preparation of CD-ROM; printing;solicitation of wire transfer distributions; creation and processing of certain
data; processing of individual or corporate number-related data; and receipt oftransfer requests.

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Article 23(1) (j)Description of theUnder Article 77 paragraph 4 of the ITA, which applies the requirements of

AIFM's procedure to

Article 109 paragraph 1 of the Companies Act to investment corporations,ensure fair treatment

investment corporations are required to treat unitholders equally depending onof investors andthe number and content of units held. In addition, upon liquidation, thedetails of any

allotment of residual assets to unitholders is required to be made equally

preferential treatment

depending on the number units held under Article 77 paragraph 2 item 2 andreceived by investors,

Article 158 of the ITA.

including detailing thetype of investors andtheir legal or
economic links with
the AIF or AIFM
Article 23(1) (k)The latest annual

Additional information may be found in INV’s most recent semi-annual reportreport referred to in

prepared in accordance with Article 22 of the AIFMD, which is available at the

Article 22(1)Asset Manager’s office located at Roppongi Hills Mori Tower, 6-10-1
Roppongi, Minato-ku, Tokyo.

Article 23(1) (l)The procedure and

INV is authorized under the articles of incorporation to issue up to 10,000,000

conditions for theunits. The units of INV’s predecessor, TGR Investment, Inc., were listed on

issue and sale of the

Osaka Stock Exchange on May 17, 2004. On February 1, 2010, TGR

units

Investment, Inc. merged with LCP and changed the corporate name to
Invincible Investment Corporation. The units of INV have been listed on theTokyo Stock Exchange since August 1, 2006. Secondary market sales andtransfers of units will be conducted in accordance with the rules of the Tokyo
Stock Exchange. Unit prices on the Tokyo Stock Exchange are determined ona real-time basis by the equilibrium between bids and offers. The Tokyo Stock
Exchange sets daily price limits, which limit the maximum range of fluctuation
within a single trading day. Daily price limits are set according to the previous
day’s closing price or special quote.

Article 23(1) (m)Latest net asset value

INV’s unit’s latest market price is publicly available at the Tokyo Stockof the AIF or latest

Exchange or from financial information venders (including Reuters), which canmarket price of thebe viewed atunit or share of the

http://www.reuters.com/finance/stocks/overview?symbol=8963.T

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AIF
Article 23(1) (n)Details of the

The units of INV were listed on the Tokyo Stock Exchange on August 1, 2006.

historical performance

The performance of the units for the most recent five fiscal periods is asof the AIF, where

follows.

available
Fiscal period

30th fiscal period

Total Assets

Total NetNet Assets per(JPY million)

Assets (JPY

unit (base value)

million)(JPY)

374,512

181,523

37,871

455,362

221,364

39,063467,931

233,046

41,125

522,431259,730

42,601

516,663249,538

40,929(from January 1,
2018 to June 30,
2018)
31st fiscal period(from July 1, 2018
to December 31,
2018)
32nd fiscal period(from January 1,
2019 to June 30,
2019)
33rd fiscal period(from July 1, 2019
to December 31,
2019)
34th fiscal period(from January 1,
2020 to June 30,
2020)

Article 23(1) (o)Identity of the prime

No applicable prime broker.

broker, any material
arrangements of the
AIF with its prime
brokers, how conflicts

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of interest aremanaged with theprime broker and theprovision in thecontract with thedepositary on thepossibility of transfer
and reuse of AIF
assets, andinformation about any
transfer of liability tothe prime broker that
may exist
Article 23(1) (p)Description of how

The AIFM will disclose the matters described in Articles 23(4) and 23(5)and when periodic

periodically through the AIF Internet website and other public disclosures.

disclosures will bemade in relation toleverage, liquidity andrisk profile of theassets, pursuant to
Articles 23(4) and23(5)Article 23(2)The AIFM shall inform

Not applicable.

the investors before
they invest in the AIF
of any arrangement
made by thedepositary tocontractuallydischarge itself ofliability in accordancewith Article 21(13)The AIFM shall also

Not applicable.

inform investors of

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any changes withrespect to depositary
liability without delay
Article 23(4)(a)Percentage of the

There are no assets that are subject to special arrangements arising from their

AIF's assets which are

illiquid nature.

subject to special
arrangements arisingfrom their illiquid
nature. The
percentage shall becalculated as the net
value of those assets
subject to special
arrangements divided
by the net asset valueof the AIF concerned
Overview of any

There are no such special arrangements.

special arrangements,
including whether they
relate to side pockets,gates or otherarrangements
Valuation

There are no such special arrangements.

methodology applied
to assets which are
subject to sucharrangements
How management

There are no such special arrangements.

and performance fees
apply to such assets
Article 23(4)(b)Any new

Any new arrangements or change in applicable arrangements will bearrangements fordisclosed at an appropriate time.

managing the liquidityof the AIF

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For each AIF that the

Any new arrangements or change in applicable arrangements will be

AIFM manages that is

disclosed at an appropriate time.

not an unleveraged
closed-end AIF, notify
to investors wheneverthey make changes to
its liquidity
management systems(which enable an
AIFM to monitor theliquidity risk of the AIF
and to ensure theliquidity profile of theinvestments of the AIF
complies with its
underlying obligations)that are material inaccordance with
Article 106(1) ofRegulation (EU) No
231/2013(i.e., there is a
substantial likelihoodthat a reasonable
investor, becoming
aware of suchinformation, would
reconsider its
investment in the AIF,
including becausesuch information could
impact an investor’sability to
exercise its rights inrelation to its
investment, or23
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otherwise prejudice
the interests of one ormore investors in the
AIF).
Immediately notify

Any new arrangements or change in applicable arrangements will be

investors where they

disclosed at an appropriate time.

activate gates, side
pockets or similar
special arrangements
or where they decideto suspend
redemptions
Overview of changes

Any new arrangements or change in applicable arrangements will be

to liquidity

disclosed at an appropriate time.

arrangements, even if
not special
arrangements
Terms of redemption

INV is a closed-end investment corporation, and unitholders are not entitled toand circumstances

request the redemption of their investment.

where management
discretion applies,
where relevant
Also any voting or

There are no voting or other restrictions on the rights attaching to units.

other restrictions
exercisable, the lengthof any lock-up or any
provision concerning‘first in line’ or ‘prorating’ on gates andsuspensions shall be
included
Article 23(4)(c)
The current risk profile

The appropriateness and effectiveness of the risk management structure areof the AIF and the risk

regularly evaluated and enhanced by the AIFM.

management systems

Funds from debts are mainly used for asset acquisition or debt repayment.

employed by the AIFM

These are exposed to liquidity risk at the time of repayment. However, the24
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to manage those risks

liquidity risk is controlled through such measures as striving to maintain andstrengthen the capacity to procure funds from the capital market via capitalraising, along with securing several fund procurement sources and diversifying
repayment deadlines, and also preparing monthly plans for funds.
Debt with a floating interest rate is exposed to interest rate fluctuation risks,
but the impact that interest rate rises have on the operations is limited bykeeping the LTV at low levels and maintaining the proportion of debt that islong-term, fixed-rate debt at high levels.
Furthermore, derivative transactions (interest rate swap transactions) areavailable as hedging instruments to mitigate the risks of rises in floatinginterest rates.
Tenant leasehold and security deposits are deposits from tenants and are
exposed to liquidity risks arising from tenants moving out of properties, but theliquidity risk is controlled through such measures as preparing monthly plans
for funds.

Measures to assess

No such measures have been implemented.

the sensitivity of the
AIF’s portfolio to themost relevant risks towhich the AIF is or
could be exposed
If risk limits set by theNo such situation has occurred.

AIFM have been or
are likely to be
exceeded and wherethese risk limits havebeen exceeded a
description of thecircumstances and theremedial measures
taken
Article 23(5)(a)Any changes to the

Any new arrangements or change in applicable arrangements will be

maximum amount of

disclosed at an appropriate time.

leverage which the
AIFM may employ on

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behalf of the AIF,
calculated inaccordance with thegross andcommitment methods.
This shall include theoriginal and revised
maximum level ofleverage calculated inaccordance with
Articles 7 and 8 ofRegulation (EU) No
231/2013, whereby
the level of leverage
shall be calculated as
the relevant exposure
divided by the net
asset value of the AIF.
Any right of the reuse

No such right or guarantee exists.

of collateral or any
guarantee granted
under the leveraging
agreement, including
the nature of the rights
granted for the reuseof collateral and thenature of theguarantees granted
Details of any change

Any new arrangements or change in applicable arrangements will bein service providers

disclosed at an appropriate time.

relating to the above.
Article 23(5)(b)Information on the

The aggregated amount of debt with interest is JPY 263,468 million as of

total amount ofJune 30, 2020.

leverage employed by
the AIF calculated in

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accordance with thegross andcommitment methods

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